Catalyst Paper gains additional support for recapitalization

RICHMOND, BC, Jan. 25, 2012 /CNW/ - Catalyst Paper Corporation (TSX: CTL) announced that it has gained additional support for the proposed recapitalization transaction and now has the support of holders of approximately 69.8% of the company's 11% senior secured notes due 2016 (the Senior Secured Notes) and holders of approximately 40.1% of the company's 7 3/8% senior notes due 2014 (the Senior Notes were issued under the company's former name, Norske Skog Canada Limited).  Holders of the Senior Secured Notes and Senior Notes who are parties to the Restructuring and Support Agreement (the Agreement) (or have signed joinder agreements) have agreed to vote in favour of and support the recapitalization transaction. The company will continue to solicit and expects further support for the recapitalization by January 27, 2012 (the early consent deadline under the Agreement).

Details of the recapitalization will be provided in an information circular expected to be distributed to shareholders and holders of the Senior Secured Notes and Senior Notes in February, 2012. The recapitalization is expected to close by March 31, 2012.

Further information concerning the recapitalization, please refer to the filings of the company available on SEDAR (www.sedar.com), EDGAR (www.sec.gov and the company's web page www.catalystpaper.com).  Investors who have questions about the recapitalization may contact Nancy Turner of Perella Weinberg Partners, the financial advisor for Catalyst Paper, at 415-671-4550.

Catalyst Paper manufactures diverse specialty mechanical printing papers, newsprint and pulp. Its customers include retailers, publishers and commercial printers in North America, Latin America, the Pacific Rim and Europe. With four mills, located in British Columbia and Arizona, Catalyst has a combined annual production capacity of 1.9 million tonnes. The company is headquartered in Richmond, British Columbia, Canada and its common shares trade on the Toronto Stock Exchange under the symbol CTL. Catalyst is listed on the Jantzi Social Index® and is ranked by Corporate Knights magazine as one of the 50 Best Corporate Citizens in Canada.

Forward-Looking Statements

Certain matters set forth in this news release, including statements with respect to implementation of the recapitalization and the benefits to the company of the recapitalization, are forward looking. These forward-looking statements reflect management's current views and are based on certain assumptions including assumptions as to future operating conditions and courses of action, economic conditions and other factors management believes are appropriate. Such forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in these statements, including failure to obtain court and stock exchange approvals, failure to obtain the support of the holders of at least two-thirds in principal amount of the Senior Secured Notes and the Senior Notes, failure to obtain any required approvals of Catalyst's securityholders, failure by any union locals at Catalyst's Canadian mills to ratify the new labour agreement and those risks and uncertainties identified under the heading "Risks and Uncertainties" in Catalyst's management's discussion and analysis contained in Catalyst's annual report for the year ended December 31, 2010, and our third quarter interim report available at www.sedar.com.

Investors:	Media:
Brian Baarda  Vice-President, Finance & CFO  604-247-4710	Lyn Brown Vice-President, Marketing & Corporate Responsibility 604-247-4713
Alistair MacCallum Vice-President, Treasurer & Corporate Controller 604-247-4037