Domtar Closes Sale Of Norampac

Montreal, December 29, 2006 – Domtar Inc. announced today that it has closed the sale of its 50% interest in Norampac Inc. to Cascades Inc., announced on December 5. The net after tax proceeds from the sale will be used to reduce the initial financing requirements of Domtar to complete its transaction to combine with Weyerhaeuser’s fine paper business, or to repay its indebtedness.

DOMTAR IS THE THIRD LARGEST PRODUCER OF UNCOATED FREESHEET PAPER IN NORTH AMERICA. IT IS ALSO A LEADING MANUFACTURER OF BUSINESS PAPERS, COMMERCIAL PRINTING AND PUBLICATION PAPERS, AND TECHNICAL AND SPECIALTY PAPERS. DOMTAR MANAGES ACCORDING TO INTERNATIONALLY RECOGNIZED STANDARDS 18 MILLION ACRES OF FORESTLAND IN CANADA AND THE UNITED STATES, AND PRODUCES LUMBER AND OTHER WOOD PRODUCTS. DOMTAR HAS 8,500 EMPLOYEES ACROSS NORTH AMERICA.

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