Hollinger Inc.

Hollinger Inc. was a Canadian media holding company established in 1985 by businessman Conrad Black. Based in Toronto, it became the principal corporate vehicle for Black's newspaper and publishing interests and, for a period, was described as one of the world's largest media groups. The company took its name from Hollinger Gold Mines, a historic Ontario mining business that had later become Hollinger Mines and had been absorbed into E. P. Taylor's Argus Corporation. Black obtained control of Argus in 1978 and reorganized or sold its assets over the following years, ultimately using the Hollinger name for his expanding media interests. The company's early transformation into an international publisher followed Black's acquisition of control of The Daily Telegraph in 1986. Hollinger subsequently developed a portfolio spanning newspapers, news services and related media properties in Canada, the United States, Israel and Australia. Its holdings included the Canadian newspaper chain Southam Inc., the Chicago-based Hollinger International group, The Jerusalem Post and interests in Australian newspaper businesses. Hollinger International, a subsidiary based in Chicago, owned the Chicago Sun-Times and other newspapers and became one of the group's most important operating entities. A major strategic step occurred in 1996, when Hollinger acquired control of Southam Inc. through stock purchases. Southam was then Canada's largest newspaper chain and also operated a newswire service. The transaction gave Hollinger a substantial Canadian publishing platform, while the group continued to expand internationally. In December 1996, Hollinger sold its 25 percent interest in Australia's John Fairfax Holdings to New Zealand's Brierley Group for US$600 million. The sale helped support the acquisition of Southam's Canadian newspaper assets and reflected Hollinger's practice of reallocating capital among media holdings. At the end of the 1990s, Hollinger was widely characterized as the world's third-largest media company. Its portfolio nevertheless remained organized through a complicated network of parent companies, subsidiaries and related entities. Hollinger sold its Canadian newspaper, magazine and Internet assets to CanWest Global Communications in August 2000 for approximately $3.5 billion. The transaction included the National Post, a national Canadian newspaper launched shortly before the sale, as well as other Canadian publishing operations. After the divestiture, Hollinger continued to hold United States newspaper assets through Hollinger International and retained other international media interests. The group's later history was dominated by governance disputes, financial deterioration and regulatory and legal proceedings. Payments described as non-competition fees and management charges were made between 1999 and 2003 to Conrad Black and associates. These transactions generated shareholder and regulatory scrutiny and contributed to the breakdown of the company's ownership and management structure. Black was removed from ownership and corporate positions during 2003 and 2004 amid allegations that company resources had been improperly diverted for personal benefit. Ravelston Corporation, Black's personal holding company and Hollinger's controlling shareholder, entered receivership in 2005. By this stage Hollinger had become largely a holding company with no substantial independent operating business and with continuing disputes over its control of Hollinger International. Hollinger filed for bankruptcy protection in both Canada and the United States on August 2, 2007. Its shares were barred from trading by the Ontario Securities Commission on July 23, 2008, and the company was delisted from the Toronto Stock Exchange on August 22, 2008. Hollinger's former Canadian newspaper assets later became part of the Postmedia chain after CanWest's own financial collapse and asset sales, but Hollinger Inc. itself ceased to function as an active media enterprise.

Hollinger Inc. emerged in 1985 from Conrad Black's restructuring of his Canadian corporate interests. The name was inherited from Hollinger Gold Mines, an Ontario mining enterprise that had become Hollinger Mines and later formed part of E. P. Taylor's Argus Corporation. Black had taken control of Argus in 1978 and subsequently disposed of its operating assets. Hollinger became the holding company through which he assembled a large international newspaper portfolio. The group's media expansion accelerated after Black gained control of The Daily Telegraph in 1986. Hollinger used acquisitions, stock purchases and affiliated companies to build positions in newspapers and related media businesses across several countries. Its principal interests included Hollinger International in the United States, Southam Inc. and other Canadian publishing assets, The Jerusalem Post and investments in Australian newspaper companies. Hollinger International's Chicago portfolio included the Chicago Sun-Times, which served as its best-known American newspaper asset. In 1996 Hollinger acquired control of Southam Inc., at that time Canada's largest newspaper chain and a newswire operator. The purchase followed the sale of Hollinger's 25 percent position in John Fairfax Holdings to Brierley Group for US$600 million. This transaction illustrated the group's capital-allocation strategy: interests in one market could be sold to finance control or expansion in another. During the late 1990s Hollinger was commonly described as the world's third-largest media company. The company then shifted away from direct ownership of its Canadian publishing platform. In August 2000 it sold its Canadian newspaper, magazine and Internet assets to CanWest Global Communications for approximately $3.5 billion. The assets included Southam-related newspapers and the National Post, a recently established national newspaper. Hollinger retained important American newspaper interests through Hollinger International and continued to operate as a holding company with international media investments rather than as a unified newspaper operator. Its corporate structure became increasingly complicated, involving Hollinger Inc., Hollinger International, Ravelston Corporation and other related entities. From 1999 through 2003, non-competition payments and management fees made to Conrad Black and associates became central to shareholder complaints and regulatory and court proceedings. Black was removed from ownership and corporate positions during 2003 and 2004 after allegations that company assets had been diverted for personal benefit. The disputes, combined with debt and the loss of major operating assets, weakened Hollinger's ability to function as an independent business. Ravelston, which controlled most of Hollinger, entered receivership in 2005. Hollinger filed for bankruptcy protection in Canada and the United States on August 2, 2007. The company continued to assert control over Sun-Times Media Group, but it no longer had the broad operating base that had supported its earlier growth. The Ontario Securities Commission halted trading in Hollinger shares on July 23, 2008, and the Toronto Stock Exchange delisted them on August 22, 2008. Hollinger Inc. therefore ended as a corporate media holding company, while several of its former newspaper properties continued under later owners. CanWest itself eventually failed, and its newspapers and newswire operations were acquired by Postmedia Network in 2010.

• 2008

  Trading is halted and shares are delisted

  [1]Hollinger Inc.en.wikipedia.org

  The Ontario Securities Commission stopped trading in Hollinger shares in July, followed by Toronto Stock Exchange delisting in August.

• 2007

  Bankruptcy protection is sought

  [1]Hollinger Inc.en.wikipedia.org

  Hollinger filed for bankruptcy protection in both Canada and the United States.

• 2005

  Ravelston enters receivership

  [1]Hollinger Inc.en.wikipedia.org

  The holding company that controlled Hollinger was placed in receivership during the group's financial and legal crisis.

• 2000

  Canadian publishing assets are divested

  [1]Hollinger Inc.en.wikipedia.org

  CanWest Global Communications acquired Hollinger's Canadian newspaper, magazine and Internet assets for approximately $3.5 billion.

• 1996

  Southam comes under Hollinger control

  [1]Hollinger Inc.en.wikipedia.org

  Stock purchases gave Hollinger control of Southam Inc., Canada's largest newspaper chain at the time.

• 1996

  John Fairfax stake is sold

  [1]Hollinger Inc.en.wikipedia.org

  Hollinger sold its 25 percent stake in John Fairfax Holdings for US$600 million, partly supporting the Southam transaction.

• 1986

  Control of The Daily Telegraph is acquired

  [1]Hollinger Inc.en.wikipedia.org

  The company became an international newspaper group after Black acquired control of The Daily Telegraph.

• 1985

  Hollinger Inc. is established

  [1]Hollinger Inc.en.wikipedia.org

  Conrad Black established Hollinger Inc. as a holding company for his media interests after selling or reorganizing assets associated with Argus Corporation.

• 1978

  Conrad Black takes control of Argus Corporation

  [1]Hollinger Inc.en.wikipedia.org

  Black gained control of the conglomerate that had previously absorbed Hollinger Mines, providing the corporate background from which the later Hollinger media holding company developed.

An acquisitive international newspaper and media holding company built around control investments, cross-border publishing assets and a portfolio-management model.

• Newspapers

  Southam newspaper chain

  Southam was Canada's largest newspaper chain when Hollinger obtained control in 1996. The business provided Hollinger with a broad national Canadian newspaper platform and included a newswire service. Hollinger later transferred its Canadian newspaper and related media assets to CanWest Global Communications in 2000.

• National newspaper

  The National Post

  The National Post was a recently established Canadian national newspaper included in Hollinger's Canadian media portfolio. It was sold to CanWest Global Communications in 2000 and later became associated with Postmedia after subsequent ownership changes in Canada's newspaper sector.

• Newspaper

  Chicago Sun-Times

  The Chicago Sun-Times was the flagship newspaper of Hollinger International, Hollinger's principal United States subsidiary. It represented the group's continuing American newspaper interests after the sale of its Canadian operations.

• Newspaper

  The Jerusalem Post

  The Jerusalem Post was among the international newspaper properties associated with Hollinger's media portfolio. It formed part of the group's strategy of holding influential newspaper brands in multiple national markets.

• News service

  Newswire service

  Hollinger's Canadian media holdings included a newswire operation associated with Southam. The service complemented the group's newspaper businesses by supplying news content and distribution capabilities.

• 2003

  Non-competition payments and management-fee controversy

  Payments made from 1999 to 2003 to Conrad Black and associates, described as non-competition payments and management fees, prompted shareholder complaints and lengthy court and regulatory proceedings. The controversy contributed to the removal of Black from ownership and corporate positions and intensified scrutiny of Hollinger's interrelated corporate structure.

  Source

Read more

• 2007

  Seek bankruptcy protectionOther

  Background

  After the sale of major operating assets, governance disputes, financial problems and the receivership of controlling shareholder Ravelston, Hollinger no longer had a stable independent operating base.

  Action taken

  Hollinger filed for bankruptcy protection in Canada and the United States.

  Aftermath

  Trading restrictions and eventual Toronto Stock Exchange delisting followed, marking the end of Hollinger as an active listed media company.

  Source

• 2000

  Divest Canadian media assets to CanWestM&A

  Background

  Hollinger chose to monetize its Canadian newspaper, magazine and Internet portfolio after building a large national position.

  Action taken

  The company sold the Canadian assets, including the National Post and Southam-related properties, to CanWest Global Communications.

  Aftermath

  Hollinger retained significant United States newspaper interests but became more dependent on a complex holding-company structure and fewer operating assets.

  Transaction value. Approximately $3.5 billion (2000)

  Source

• 1996

  Acquire control of Southam Inc.M&A

  Background

  Hollinger was building a major Canadian newspaper platform and sought control of Southam, then the country's largest newspaper chain.

  Action taken

  The company used stock purchases to take control of Southam and its newspaper and newswire assets.

  Aftermath

  The acquisition substantially expanded Hollinger's Canadian presence before the assets were sold to CanWest in 2000.

  Source

• 1996

  Sell John Fairfax investment to fund expansionStrategy

  Background

  Hollinger needed capital for its Canadian newspaper expansion and held a significant minority interest in Australian newspaper company John Fairfax Holdings.

  Action taken

  It sold its 25 percent John Fairfax stake to Brierley Group for US$600 million.

  Aftermath

  The proceeds helped finance the Southam transaction and demonstrated Hollinger's use of portfolio disposals to fund media acquisitions.

  Sale proceeds. US$600 million (1996)

  Source

1. 1Hollinger Inc.en.wikipedia.org