Bowater Announces Purchase Price for 10.25% Debentures Due 2003.

GREENVILLE, S.C.--(BUSINESS WIRE)--Dec. 16, 1998--Bowater Pulp and Paper Canada Inc. (BPPC), a subsidiary of Bowater Incorporated (NYSE: BOW), today announced the purchase price to be paid in cash for its 10.25% Debentures that are due 2003, pursuant to the company's tender offer that commenced on November 19, 1998.

In accordance with the terms of the offer, the price to be paid for tendered Debentures is $1,169.31 per $1,000 principal amount. This price is based on a reference Treasury yield of 4.538% at 10:00 a.m. EST, on December 15, 1998, plus a fixed spread of 100 basis points. The tender offer will expire at 5:00 p.m. EST, on Thursday, December 17, 1998, unless extended.

Bowater Pulp and Paper Canada Inc. is a subsidiary of Bowater Incorporated, which is headquartered in Greenville, SC. Bowater Incorporated is a global leader in newsprint. In addition, Bowater Incorporated makes coated and uncoated groundwood papers, bleached kraft pulp and lumber products. It has 11 pulp and paper mills in the United States, Canada and Korea. These operations are supported by more than 4 million acres of timberlands owned in the United States and Canada and over 14 million acres of timber cutting rights in Canada. Bowater Incorporated is one of the world's largest users of recycled newspapers and magazines. Bowater Incorporated common stock is listed on the New York Stock Exchange, U.S. regional exchanges and the London Stock Exchange. A special class of stock exchangeable into Bowater common stock is listed on the Toronto and Montreal exchanges (TSE and ME: BWX).

All amounts are in U.S. dollars

This news release is neither an offer to purchase nor a solicitation of an offer to sell securities. The tender offer is only made pursuant to the offering documents. J.P. Morgan & Co. is the dealer manager and Morrow & Co. Inc. is the information agent for the tender offer.