AbitibiBowater to auction surplus equipment, buildings in Iroquois Falls

Ross Marowits, THE CANADIAN PRESS

MONTREAL - AbitibiBowater is auctioning equipment and buildings Thursday in Iroquois Falls, Ont., that have been made surplus by a restructuring of its woodlands operations.

Ritchie Bros. Auctioneers (TSX: RBA), the world's largest industrial auctioneers, will conduct the unreserved public auction starting at 8 a.m. for the insolvent forest products company and other owners in the area.

Montreal-based AbitibiBowater said it is selling "a small amount of logging equipment, buildings and miscellaneous supplies and parts surplus to our needs."

Items include wheel loaders, crawler tractors, skidders, log trailers and forklifts.

The sale follows a restructuring of its Iroquois Falls woodlands, which resulted in harvesting operations being transferred to contractors.

Company spokesman Jean-Philippe Cote said the sale will have no impact of the mill or its overall woodlands activities.

The auction includes the sale of more than 470 items, including a 1,890-square-metre warehouse and garage.

Kim Schulz said the auction is small by Ritchie's standards, but should fetch several million dollars. Abitibi is supplying about 80 per cent of the auction items.

The challenges facing the Canadian forestry shouldn't necessarily minimize bids since the auction house will attract potential buyers from around the world, Schulz said in an interview.

"One of the reasons why companies would stick their equipment in one of our sales is that they don't have to rely on their local market," Schulz said.

"If the local market is depressed or not doing so well, they can put their equipment in our auction and it will sell for global market value because we attract people from around the world."

However, items will be sold Thursday to the highest bidder, regardless of price.

AbitibiBowater said it considered conducting the auction itself but decided to contract Ritchie for the first time in order to sell everything and because of the auctioneer's reach.

The company has been in creditor protection in Canada and the United States since April. It is in the process of also selling surplus lands and hydro assets, including the $615-million sale of its interest in a power facility in Manicouagan, Que.