Newsprint manufacturer Abitibi-Consolidated has hit back at criticism by its 11% shareholder, Quebecor.


Quebecor had issued public statements saying "a change of corporate culture was needed" after the resignation of Abitibi chairman Michel Desbiens last week.


Quebecor spokesman Luc Lavoie said: "Abitibi would be better off adopting Donahue's management practices to make it more cost-effective and entrepreneurial."


At a meeting held by Abitibi's board of directors, a decision was made to set up a special committee of directors who are independent of Quebecor.


Abitibi's manager of public affairs, Dennis Le Clerc, said: "Desbiens decision to resign was a personal one. In the light of publication of our figures, which showed our net earnings had increased by 77%, we are surprised at the nature of the criticism by Quebecor."


Desbiens, who was previously chief executive of Donahue, resigned immediately after Abitibi reported its third quarter figures.


No reasons were given for his exit, and no replacement has yet been named, but Desbiens will remain a member of the board.


It is understood that management differences had arisen, with rumours that members of Donahue's executive team would leave the combined company.


Abitibi's third quarter net earnings figures rose 125% to 48m (C$108m) compared with the same period last year, with net sales rising 15% to 765m.


Story by Andy Scott