An Ontario judge has approved a proposal by CanWest Global Communications Corp. to shift its flagship National Post newspaper to a subsidiary that contains the company's other newsprint assets, such as the Vancouver Sun and Ottawa Citizen.
In court documents filed this week, CanWest said it would have to close the newspaper if the asset shuffle weren't allowed since creditors at the parent company, which owns Global Television, didn't want to cover further financial losses at the paper. Creditors at the newspaper subsidiary agreed to move the National Post into the sub-company.
Sources close to the restructuring said there was little doubt the move would take place since all major creditors agreed in advance to the proposal and there were no legal objections. However, the shift has broader implications for the company.
Before the shuffle, the National Post was part of CanWest Media Inc., which filed for court protection from creditors three weeks ago. CanWest Media is the holding company for the operating assets of CanWest Global.
CanWest is moving the Post into its newspaper subsidiary, CanWest LP, to group all of the company's print assets together in advance of a separate filing for court protection for that business.
It is expected the newspaper subsidiary, which owns about a dozen papers across the country, will file for protection under the Companies' Creditors Arrangement Act (CCAA) in the coming weeks. That could lead to the company being split up as part of the restructuring.
A lawyer for CanWest said Friday that the National Post has never turned a profit and the creditors of the parent company, a group of hedge funds that own most of the company's bonds, don't want to continue covering its losses.
"If the bondholders on the [parent company] side thought they could squeeze one more nickel out of it, they would have," CanWest lawyer Lyndon Barnes said. "There is just no money to continue beyond today."
However, Mr. Barnes said the paper does have value to the other papers in the CanWest chain if grouped with those print assets.
The newspapers have numerous shared services contracts among them, which result in cost savings for the print subsidiary
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6 comments:
I wouldn't have missed it. I actually refuse it when they offer me a free copy. I say, "No, I would prefer a newspaper." The Post has always been a propaganda organ - that's what it was designed to do, for the criminal Conrad Black, and that's what it continues to do.
My dog will be happy.
It is sad how the left don't care about the losses of jobs if they think that might advance their cause.
Many of us taxpayers money should not be used to bail out private/public companies regardless of what idelogy they espouse.
GM, Bombardier (family controlled voting shares)
Is the CBC balanced or an organ of the Liberals?
How many newscasts on wafers, bodybags, 120 seconds late for photo ops, chequegate and little coverage correcting the facts when they become available?
Misinformation from the CBC on behalf of the agenda from the left on the taxpayer dime?
Not only is it "a solid read", but I defy anyone to find a more absorbent gerbil cage liner. It's better than a shamwow, especially the editorials.
Moving the deck chairs on the Titanic.
The whole of CanWest Global is stumbling under a mountain of debt while advertizing revenues dry up.
Something has to give.
Well, it may be too late for the newspapers to recover -- and there is no doubt the Post leans right but that doesnt mean it shouldn't exist! Of course, if the free market will not support a right wing chain of newspapers but it will support a moderate or left wing group... Well, Atlas Shrugged!
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