Osprey close to buying southern Ontario CanWest papers

Osprey Media, which last year bought 16 daily and 13 community newspapers from Hollinger, is close to buying the majority of southern Ontario CanWest Global newspapers.

That is the news being repeated by several sources, including the Globe and Mail. In the Nov. 5 edition of the Globe and Mail, media reporter Keith Damsel said the deal would see Osprey pay about $180-million to $200-million for about 30 newspapers, including The Stoney Creek News, The New Hamburg Independent and The Niagara Falls Review. The Windsor Star would not be included in the deal.

Damsel wrote that Torstar Corp., an early participant in the CanWest bidding process, is no longer involved in negotiations. The Toronto newspaper company has extensive newspaper assets across Southern Ontario but has pledged not to overpay for acquisitions.

The news of the Canadian media company looking to divest itself of non-core assets came just before it released its financial report for the 4th quarter of 2002. CanWest GlobalÔÇÖs EBITDA for its newspaper assets increased by 18 per cent to $292 million, compared to the pro forma result (including the National Post) of $246 million for the previous year. The company said its EBITDA improvement was attributable to cost reductions at all major newspapers and substantially reduced EBITDA losses at the National Post.

But CanWest is still looking at a $3.9-billion debt. It has previously sold 12 newspapers in Atlantic Canada and Saskatchewan to Montreal's GTC Transcontinental Group Ltd. for about $250-million in order to help pay down that debt.

In releasing CanWestÔÇÖs 4th quarter results, Leonard Asper, CanWest's President and Chief Executive Officer said debt reduction remains the companyÔÇÖs top priority. "Our most important task will be to press ahead on the many projects we initiated in 2001 and 2002,ÔÇØ he said. ÔÇ£We have made significant progress in the divestiture of non-core newspaper and TV assets over the past year, bringing in approximately $500 million in proceeds that were applied to reduce our senior debt. We continue to explore opportunities to divest or monetize additional assets that are not central to our corporate strategy, at prices which we believe reflect their fair value."

Osprey Media is run by Michael Sifton, formerly president of Hollinger Canadian Newspapers.