<B>Bowater Cancels Deal for Korean Mill</B>

Bowater Inc. terminated negotiations with Sepoong Corp. and its major creditor, Chohung Bank, to acquire the Sepoong paper mill located in South Korea. Bowater noted that there were unacceptable delays in satisfying certain conditions contemplated when the parties signed the previously announced preliminary letter of intent this past September.

In 1998, Bowater acquired the Halla newsprint mill in South Korea, which has about 265,000 metric tons of recycled newsprint capacity.