BUSINESS MEMO: NEWSPRINT MERGER

Two major Canadian newsprint makers, Abitibi-Consolidated Inc. and Donohue Inc., are merging in a $4 billion cash-and-stock deal to create a massive player that would control 35 percent of the market in North America.

When Abitibi-Consolidated, the largest newsprint maker on the continent, completes its takeover of No. 3 Donohue, the combined business will have double the capacity of the No. 2 manufacturer, Bowater Inc. of Greenville, S.C.

Publishing analysts said the industry consolidation evident with Friday's merger agreement could strengthen the hand of producers in their efforts to raise prices for newsprint, which is used by newspapers. Prices have slipped recently, but analysts said price increases did not seem imminent.