Torstar

Torstar Corporation is a Canadian media conglomerate. The company is primarily a publisher of daily and community newspapers, including its flagship and namesake, the Toronto Star. On May 26, 2020, Torstar agreed to be acquired by NordStar Capital, a private investment firm.[2]

Torstar Corporation
Public
Traded asTSX: TS.B
ISINCA8914742074 
IndustryMass media
Founded1958
HeadquartersOne Yonge Street
Toronto, Ontario
Key people
John Boynton, President
Number of employees
4,000 (2016)[1]
DivisionsDaily News Brands
Metroland Media Group
Websitewww.torstar.com
One Yonge Street, the Torstar headquarters

History

Torstar was founded after the Ontario government passed a law barring the provisions of late-Toronto Star owner Joseph Atkinson's will from being enacted. Atkinson had bequeathed the newspaper to a charitable organization he had founded. The Progressive Conservative provincial government of George Drew passed a law banning charitable organizations from operating profitable entities such as newspapers. Rather than sell the newspaper, the trustees of the Atkinson Foundation bought out the Star privately and founded Torstar as a private corporation.

On November 26, 2010, it was announced that the Canadian Press news agency would be taken over by a for-profit corporation, with Torstar serving as one of its investors.[3] In December 2011, Torstar acquired a 25% minority stake in specialty television channel owner Blue Ant Media.[4]

On November 27, 2017, Postmedia and Torstar announced a transaction in which Postmedia will sell seven dailies, eight community papers, and the Toronto and Vancouver 24 Hours to Torstar, in exchange for 22 community papers and the Ottawa and Winnipeg versions of Metro. Except for the Exeter Times-Advocate, St. Catharines Standard, Niagara Falls Review, Peterborough Examiner, and Welland Tribune, all acquired papers will be closed. Torstar stated that it wanted to focus on building synergies within its existing markets served.[5][6] The swaps effectively remove competition between the two companies in the affected markets;[7] the Competition Bureau stated that it would review the proposed deal.[8] and in March 2018, formally accused the companies of using no-compete clauses to reduce competition in the newspaper industry, in violation of the Competition Act.[9][10]

On September 20, 2018, Torstar announced that it would acquire iPolitics.ca to enhance its coverage of the federal government.[11]

On December 20, 2018, Torstar applied to the Ontario Superior Court for an order to keep documents seized from its offices by the Competition Bureau sealed from the public.[12]

Sale to NordStar

On May 26, 2020, Toronto Star publisher John Honderich announced the sale of Torstar to Nordstar Capital, controlled by Jordan Bitove and Paul Rivett, for $52 Million CAD. The Class A and Class B non-voting share price was set at 63 cents in the deal. The new owners planned to make Torstar a private company with former Premier of Ontario David Peterson as chair of the board. By that time, the company was experiencing financial issues, a situation described by Honderich as an "uphill struggle".[13] Weeks earlier, Torstar had reported a $23.5-million loss for the first quarter of 2020.[14] The deal, with financing from Canso Investment Counsel Ltd.,[15] was expected to close by year end. Since 2017, the largest shareholder in Torstar was Fairfax Financial, owning 40% of the company's B shares.[16]

In a published statement, Paul Rivett said that Nordstar would work to ensure the "long-term viability of the business" and to continue the Torstar publications' values."Torstar was formed around these values [the advancement of society], the Atkinson Principles, and I can assure you that if the agreement is approved, they will continue to serve as the organization’s intellectual foundation."[17]

Operations

Torstar's media operations are divided into two primary divisions: Daily News Brands, Community Brands and Digital Ventures.

In September 2018, Torstar announced a deal to acquire the existing political news website iPolitics, effective on 1 October 2018. The initial coverage of the deal did not clarify which of the following divisions of the company would be the formal owner of iPolitics.[18] Torstar did announce that iPolitics would maintain its own bureau in Ottawa.[19] After the sale was completed, Torstar laid off five of the publication's staff, and appointed Marco Vigliotti as the senior editor.[20]

Daily News Brands

The Daily News Brands (Torstar) division primarily comprises the Toronto Star and its associated properties, including Torstar Syndication Services. The division also owns another six Ontario regional daily newspapers and a stake in the Canadian edition of the Chinese-language Sing Tao Daily.[21]

The StarMetro (newspaper) chain with free dailies distributed in Calgary, Edmonton, Halifax, Toronto, and Vancouver was part of this Brand but publication of all titles ceased by the end of 2019.

Community Brands

The Community Brands division, Metroland Media Group, owns more than 70 weekly community papers as of late May 2020, the free magazine Canadian Immigrant, and other community-oriented properties.[22]

VerticalScope

On July 29, 2015, Torstar announced its acquisition of a 56% majority stake in VerticalScope, a Toronto-based operator of online communities, for $200 million. The company operates websites and message boards that focus on niche categories, particularly within the automotive industry. Torstar CEO David Holland explained that the purchase was designed to bolster the company's presence in digital media.[23]

In 2017, Torstar discontinued the operations of VerticalScope.[24]

Star Touch and ePaper apps

Launched in 2015, Toronto Star Touch was the company's app designed specifically for tablet computers. It was discontinued in late July 2017 after an investment totaling $20 million because of an inadequate volume of readers and advertisers and was replaced by ePaper.[25] The latter is "a new universal app" (a digital copy of the print version of the Star) available for both Android and iOS smartphones and tablets.[26][27]

Other investments

Torstar owns a 20 per cent stake in the Victoria, British Columbia-based newspaper publisher Black Press,[28] and a 16 per cent stake in broadcaster Blue Ant Media. The company is also part owner of The Canadian Press.[29]

Past investments

Torstar launched a weekly celebrity-based magazine called Scoop in 2005, which folded one year later.

Between late 2005 and early 2011, Torstar also held a 20 per cent stake in CTVglobemedia, a Canadian media company which broke up when BCE Inc., the parent company of Bell Canada, purchased the company's media assets.[30] This caused some controversy because CTVgm owned The Globe and Mail, a competing newspaper to Torstar's own Toronto Star. There were no editorial hurdles between the two newspapers however. Torstar sold its shares in 2011.

On May 2, 2014, Torstar announced the sale of Harlequin Enterprises, a publisher of romance novels, to HarperCollins for $415 million.[31][32]

Corporate governance

Current members of the board of directors of Torstar are:

See also

References
  1. "Company Profile for Torstar Corp (CA;TS.B)". Retrieved 2008-10-09.
  2. "Media company Torstar to go private after sale to NordStar Capital in $52 M deal". FinancialPost. 2020-06-26. Retrieved 2020-06-27.
  3. Dana Flavelle (2010-11-26). "Major publishers invest in Canada's oldest news agency". Toronto Star. Retrieved 2015-11-25.
  4. "Torstar acquires 25 per cent stake in Blue Ant Media". Toronto Star. Retrieved 31 July 2015.
  5. "Postmedia to close community newspapers in Stratford, London, St. Thomas". CBC News. Retrieved 2017-11-27.
  6. "Torstar, Postmedia swap community papers, most to close". The Globe and Mail. Retrieved 2017-11-27.
  7. Faguy, Steve (2017-11-27). "Postmedia/Torstar deal results in almost 300 jobs lost as dozens of newspapers shut down". Retrieved 2017-11-27.
  8. "'The alarm bells should go off:' Postmedia, Torstar deal will see 36 community papers closed". Financial Post. 2017-11-27. Retrieved 2017-11-30.
  9. Jackson, Emily (2018-03-22). "Competition Bureau's concerns over Postmedia-Torstar newspaper swap revealed in court filing". Financial Post. Retrieved 2018-04-06.
  10. "Torstar, Postmedia and the arrogance of the deal". The Globe and Mail. Retrieved 2018-04-06.
  11. "Toronto Star owner to buy political website iPolitics". CBC News. Retrieved 2018-09-20.
  12. Carney, Bryan (2019-02-05). "Torstar (Again) Blocks Release of Evidence in Conspiracy Case". The Tyee. Retrieved 2019-03-04.
  13. "Media company Torstar to go private after sale to NordStar Capital in $52 M deal". FinancialPost. May 26, 2020. Retrieved May 27, 2020.
  14. "Torstar agrees to $52M sale to NordStar Capital". CBC. 2020-05-26. Retrieved 2020-05-27. recommended by a special committee of Torstar's board of directors and has the support of the majority of its shareholders and its largest independent shareholder, Fairfax Financial Holdings Ltd.
  15. "Torstar buyers say they want to take the publisher private and 'build something that's very special'". Toronto Star. May 28, 2020. Retrieved May 29, 2020. unsecured debt pays 10 per cent annual interest,
  16. "Torstar to be sold, taken private in $52-million deal". Toronto.com. 2020-05-26. Retrieved 2020-05-27.
  17. "Torstar buyers say they want to take the publisher private and 'build something that's very special'". Toronto Star. May 26, 2020. Retrieved May 27, 2020.
  18. "Torstar signs agreement to purchase political website iPolitics". CBC News, September 20, 2018.
  19. "Torstar buying Ottawa-based news site iPolitics". Global News. 2018-09-21. Retrieved 2020-05-29.
  20. "iPolitics lays off five after ownership change". The Hill Times, November 14, 2018.
  21. Daily News Brands
  22. "Canadian media company Torstar to be sold, privatized in $52M deal". Global News. 2020-05-26. Retrieved 2020-05-27. Torstar owns the Toronto Star, Hamilton Spectator, Waterloo Region Record, St. Catharines Standard, three other dailies and some 70 weeklies.
  23. "Struggling Torstar wagers $200-million on a niche digital company". The Globe and Mail. 29 July 2015. Retrieved 31 July 2015.
  24. "Media company Torstar to go private after sale to NordStar Capital in $52 M deal". FinancialPost. May 26, 2020. Retrieved May 27, 2020.
  25. Toronto Star ePaper edition
  26. "Toronto Star Shutters Star Touch, lays off 30 staff". FinancialPost. 2017-06-28. Retrieved May 27, 2020.
  27. "Toronto Star To Shutter $20-Million Tablet App". Huffington Post Canada. 2020-06-26. Retrieved 2020-05-27. Thirty employees will lose their jobs, Aleksandra Sagan Canadian Press
  28. "Is spinoff in the cards?". Financial Post. Archived from the original on 4 March 2016. Retrieved 31 July 2015.
  29. Media Classified acquires City Parent magazine from Metroland Media
  30. Kiladze, Tim (13 September 2010). "Torstar walks away from BCE-CTV smiling". The Globe and Mail. Retrieved 6 September 2012.
  31. "News Corp. to Buy Harlequin for $415M". ABC News. May 2, 2014. Retrieved May 2, 2014.
  32. Greenfield, Jeremy Greenfield (May 2, 2014). "News Corp Acquires Harlequin, Adds to HarperCollins Portfolio". Digital Book World.
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