According to Abitibi-Consolidated (ABY-OLD), they and Bowater (BOW) are currently in the process of "moving forward to comply with this request as quickly as possible," but the companies will not offer any estimation on timing to compliance at this point. The fact that the companies are open about the compliance process can be viewed as a positive, even at this relatively early stage. This is not a terribly complex overlap situation and it should be resolved without much difficulty.
As stated last week:
It remains the opinion of this publication that the companies can obtain FTC consent if they work in good faith with the regulator from day one and if they offer a divestiture or two, rather than forcing the FTC into demanding concessions further along in the review process. If the companies take to friendly/open approach, HSR clearance and deal completion is likely to occur before the end of September 2007.
Assuming the companies intend to certify compliance and force a second HSR waiting period, the compliance would naturally have to occur at some point in August in order to obtain FTC clearance by September. The information offered by ABY, albeit minimal, does not alter the current FTC timing projection.
Also, ABY confirms that that Canadian Competition Bureau did in fact continue its review beyond the April 2 deadline. ABY notes the following regarding the Candidan review process:
Technically, pursuant to the Canadian Competition Act, the companies are no longer prevented from closing, subject to the Canadian competition bureau obtaining a court order preventing closing.
It is essentially inconceivable that the companies would attempt to complete the deal without the Canadian approval, but since the FTC review promises to be the critical regulatory obstacle, the concept is essentially moot.
However, if the Canadian review somehow exceeds the U.S. review in terms of timing, the companies will almost certainly wait for the final consent before proceeding with the transaction. Nevertheless, Competition Canada approval is fully anticipated at some point before HSR clearance.
The merger remains expected to close in the fall of this year, perhaps before the end of September if HSR compliance proceeds as anticipated.