“Canwest’s publishing division signed a deal last night to reunite the National Post with its other newspaper assets after a four-year absence,” the Post reports.
Once the courts and senior lenders approve, the Post will be transferred to Canwest Limited Partnership, which operates the company’s other ten dailies, from Canwest Media Inc., a holding company of Canwest Global Communications Corp.
National Post president and CEO Paul Godfrey said:
“I can attest that the return to the fold is prompted not by misguided altruism, but by good business sense. The publishing group leadership understands the true value of the Post, and its contribution to the larger group. I came to the Post in January knowing there is a bright future for this paper. The move into the LP confirms that.”
In a press release, Canwest said that all Post employees will be offered employment under the new company.
A CBC News report notes that the transfer comes amid speculation that Canwest is preparing to sell its newspaper division.
The CBC News report states:
“Industry analysts say Canwest could fetch more than $1 billion for its newspaper assets as signs of life in the finances of the newspaper industry drive up interest in acquisitions.
“Chris Diceman, an analyst at Dominion Bond Ratings Service, believes if Canwest does go ahead with the rumoured plans, the company could pull in between $600 million and $900 million for the gathered assets in a first round of bids.
“‘If there was a bidding war for these assets either in, or part of, creditor protection, that multiple may go up even higher than that,’ he said recently.”
In early October, The Globe and Mail reported that Godfrey had lined up financial backers for buying the newspapers. The story cited anonymous sources and Canwest denied that the papers were for sale and called the story “pure speculation.”