Domtar Inc. Announces Expiration of Change of Control Offer for its 9½% Debentures Due 2016

Montreal, May 7, 2007 – Domtar Corporation (NYSE/TSX:  UFS) today announced the expiration, at 12:00 midnight, New York City time, on May 4, 2007, of the previously announced change of control offer by Domtar Inc., one of its principal operating subsidiaries, for all U.S.$125,000,000 outstanding principal amount of its 9½% Debentures Due 2016 (CUSIP Number: 257561AT7).  No debentures were tendered in the change of control offer.

The change of control offer was made solely to fulfill Domtar Inc.’s obligations under the indenture governing the debentures, which required that Domtar Inc. make an offer to purchase the debentures following a “change of control triggering event” (as defined in the indenture).  A “change of control triggering event” occurred on March 7, 2007 as a result of (i) a person becoming the holder of more than 35% of the outstanding common shares of Domtar Inc. pursuant to the combination of the fine paper business and related assets of Weyerhaeuser Company with Domtar Inc. and (ii) a rating decline within 90 days after the public announcement of such transactions as a result of a change in methodology by Moody’s Investor Services for rating North American forest product companies.

This announcement does not constitute an offer or solicitation to purchase with respect to the debentures. The change of control offer was made only by means of the Notice of Change of Control and Offer to Purchase dated April 4, 2007.

Domtar Corporation is the largest integrated producer of uncoated freesheet paper and one of the largest manufacturers of papergrade market pulp in North America. Domtar Corporation designs, manufactures, markets and distributes a wide range of business, commercial printing, publication as well as technical and specialty papers with recognized brands such as First Choice®, Domtar Microprint®, Windsor Offset®, Cougar® as well as its full line of environmentally and socially responsible papers, Domtar EarthChoice®. Domtar Corporation owns and operates Domtar Distribution Group, an extensive network of strategically-located paper distribution facilities. Domtar Corporation also produces lumber and other specialty and industrial wood products. Domtar Corporation employs nearly 14,000 people. To learn more, visit www.domtar.com.

- (30) -