February 13, 2012 / 10:44 PM / in 6 years

UPDATE 1-Abitibi seeks to block Mercer's bid for Fibrek

Feb 13 (Reuters) - Resolute Forest Products, formerly known as AbitibiBowater, said it has applied for an order to block Mercer International Inc’s offer to buy smaller peer Fibrek Inc for about C$170 million.

Montreal-based Resolute said it has applied to a Québec tribunal to cease trade rival Mercer’s offer “as it includes an improperly discounted and dilutive private placement of warrants and an unreasonable break fee.”

The bid made by Mercer on Feb 10 topped AbitibiBowater’s hostile offer by 30 percent.

Earlier on Monday, Resolute extended its bid for Fibrek by 10 days to February 23, without raising its initial offer price of about $130 million.

The company said it has requested that the bureau hear its application on an expedited basis.

Shares of Resolute, which have lost about 8 percent of their value in the past six months, closed at C$15.33 on Monday on the Toronto Stock Exchange. (Reporting by Maneesha Tiwari in Bangalore; Editing by Saumyadeb Chakrabarty)

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