Bowater Announces Notes Offering.

Business Editors

GREENVILLE, S.C.--(BUSINESS WIRE)--March 11, 2004

Bowater Incorporated (NYSE: BOW) today announced that it has entered into a definitive agreement with underwriters for an offering of an aggregate amount of $250 million of floating rate notes due March 15, 2010, under its effective shelf registration statement on file with the U.S. Securities and Exchange Commission. The interest on the notes will float on a quarterly basis at 3-month LIBOR plus 3.0%. The notes are callable by Bowater after two years with call prices for periods beginning on March 15, 2006, 2007 and 2008 of 102%, 101% and 100%, respectively. The offering price of the notes to the public is face amount. Bowater intends to use the net proceeds from this offering to repay outstanding balances under its revolving credit facility, term loan and accounts receivable securitization arrangement. Bowater expects to close the offering on March 17, 2004.

This news release does not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering would be unlawful. The offering is being led by UBS Investment Bank and JP Morgan Securities. A prospectus supplement relating to this offering may be obtained from UBS Investment Bank, 677 Washington Blvd., Stamford, Connecticut 06901, telephone [phone] or JP Morgan Securities, 270 Park Avenue, New York, New York 10017, telephone [phone].

This announcement is a forward-looking statement concerning Bowater's offering and is subject to change based on risks and uncertainties described in its 2003 Annual Report on Form 10-K and other reports filed with the U.S. Securities and Exchange Commission. Such risks and uncertainties could cause actual results to differ materially from future results expressed or implied by such forward-looking statements.

Bowater Incorporated, headquartered in Greenville, SC, is a leading producer of newsprint and coated groundwood papers. In addition, the company makes uncoated groundwood papers, bleached kraft pulp and lumber products. The company has 12 pulp and paper mills in the United States, Canada and South Korea and 13 North American sawmills that produce softwood lumber. Bowater also operates two facilities that convert a groundwood base sheet to coated products. Bowater's operations are supported by approximately 1.4 million acres of timberlands owned or leased in the United States and Canada and 32 million acres of timber cutting rights in Canada. Bowater is one of the world's largest consumers of recycled newspapers and magazines. Bowater common stock is listed on the New York Stock Exchange, the Pacific Exchange and the London Stock Exchange. A special class of stock exchangeable into Bowater common stock is listed on the Toronto Stock Exchange (TSX:BWX).

All amounts are in U.S. dollars.