Victoria’s Black Press has expanded its B.C. operations by buying 11 publications from Vancouver’s Glacier Media Inc. (TSX:GVC) for an undisclosed amount.
It then announced it would shutter five publications, including:
Black Press COO Rick O’Connor told Business in Vancouver July 5 that about 40 people are expected to lose their jobs.
He said staff at the papers were given 60 days notice of the shutdown and some may be absorbed by other papers in the chain. According to its website, Black Press owned 81 B.C.-based newspapers before the acquisition.
Glacier Media now owns 22 B.C. community newspapers in addition to newspapers published by the Business in Vancouver Media Group including Business in Vancouver, the Employment Paper and Western Investor. Glacier also owns papers in Alberta, Saskatchewan, Manitoba, Ontario and Quebec.
The other newspapers Black Press acquired in the transaction include:
Black Press also swapped papers with Alberta’s Great West Newspapers. Glacier Media and Alberta’s Jamison family each own 50% of Great West Newspapers. Great West Newspapers gave Black Press the Red Deer Express. In exchange, it gained control of Black Press’ papers in the Canmore area.
“Canmore is a very strong community. We’re happy to get that property,” said Glacier Media CFO Orest Smysnuik. “It’s a strong community. It’s vibrant. We’re happy to have that in our stable.”
He said Glacier sold its papers to Black because collectively they were not doing well financially. Glacier tried to stem those losses but when that failed, its executives chose to negotiate a sale. Smysnuik did not expect Black Press to close any of its new newspapers.
“I’m a little bit surprised, definitely saddened. I think whenever you see a newspaper title fall by the wayside, it’s not a good deal. But, times in the newspaper business are tough.”
Black Press’ O’Connor said his company executed the transactions to “fill in the holes” between existing publications. That, he said, would lead to synergies.
“In some cases they were good solid community papers in markets where we had no paper,” O’Connor said. “In other cases the papers were losing significant amounts of money and they were sort of part of the package, so to speak. It was like, ‘If you’re buying the Trail paper, then you’ve got to take the Nelson paper as well even though it’s losing a lot of money.’”
O’Connor said synergies could arise because Black Press has so many papers in B.C.
“I don’t look at it as whether Glacier couldn’t make a go of it or not,” he said. “I think part of the problem is that some of these towns – Prince Rupert for example – have been very hard hit by the impact of the recession.”
Black Press is a private company 80% owned by David Black, who started building his media empire in 1975 when he bought the Williams Lake Tribune from his father. Torstar Corp. (TSX:TS-B) owns the remaining 20% of Black Press.
It is unclear how much debt Black Press has but when BIV asked O’Connor whether there would be any more expansion, he was quick to put that speculation to rest.
O’Connor said: “Just in case somebody from the bank reads this, we’re not looking at expanding at this point. We’re looking at basically filling in the holes and looking at synergies. We’re definitely not looking at any expansion plan.”