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Sun Media Acquired by Canadian Newspaper Publisher Postmedia

Date:08-10-2014

Postmedia Canada Network which is Canada’s largest newspaper publisher has purchased Sun Media which is a chain of 175 small city dailies and tabloids, in a move that reflects the declining fortunes of the news business.

Sun Media is a subsidiary of Quebecor Media Inc. The Montreal-based Quebecor publishing and broadcasting company brought Sun Media through acquisitions, spending around $1.5 billion in 15 years.

Postmedia paid about $301 million Canadian dollars ($275 million) for the group, which includes The London Free Press and The Toronto Sun.

Sun Media and Postmedia have been struggling in an increasingly digital world, facing a series of layoffs and cutbacks. With this deal, Postmedia expect to have cost savings of 6 million to 10 million Canadian dollars. The chief executive of Postmedia, Paul Godfrey said he had no plans to close or offload any of Sun Media’s papers.

After emerging from a bankruptcy restructuring four years ago, Postmedia has strived to remake its business, by emphasizing on its digital operations. Following a recent redesign, The Ottawa Citizen has different versions customized for computer screens, tablets, smartphones and print.

Mr. Waddell added that it was unclear how Sun Media advances Postmedia’s strategy since Sun Media has been relatively slow online.

However Mr. Godfrey noted that even if they do nothing at all, the combination of both the companies’ online operations will have a larger number of users than the government-owned Canadian Broadcasting Corporation, which is the current digital news leader in Canada.

Postmedia’s own core holdings were created via acquisitions by Conrad M. Black, who acquired a chain of dailies in Canada and then founded The National Post in Toronto.

Postmedia will own both daily newspapers in several Canadian cities including British Columbia, Ottawa, Vancouver, Edmonton, Alberta, Alberta and Calgary. In Toronto, it will own two of the city’s four daily newspapers.

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