TORONTO — The door could open up for greater media competition in New Brunswick as Toronto-based Postmedia gears up to purchase all of the daily and weekly newspapers owned by the Irving family for more than $16 million in cash and shares.
Postmedia parent company Postmedia Network Canada Corp. said in a news release that it has reached an agreement to buy all outstanding shares of Brunswick News Inc., which is part of J.D. Irving Ltd., for $7.5 million in cash and $8.6 million in Postmedia shares at an implied price of $2.10 per variable voting share.
The proposed deal marks the end of an era for the Irving empire, which has been involved in newspapers in New Brunswick for more than eight decades.
"This amounts to the falling of a great old balsam fir tree," says Edward Greenspon, president and CEO of the Public Policy Forum and former editor-in-chief of the Globe and Mail. "The Irving family has been synonymous with newspapers and New Brunswick since the 1930s."
Newspapers were once a lucrative business for the Irving family, Greenspon explains. They were vertically integrated within Irving’s pulp and paper operations, and generated attractive subscription and advertising revenues.
"If they’re backing out of this industry, it just reinforces what bad shape the industry is in — particularly at a local and regional level," he says.
The Irving family's dominance of the media landscape in the province has sparked criticism for a long time, one media watcher said Friday.
"Over the years there’s been ongoing and persistent concerns about the media concentration of ownership by a family that has such a strong influence on business affairs and economic life in the province," says Philip Lee, professor of journalism and communications at St. Thomas University.
With Postmedia preparing to enter the New Brunswick market, Lee sees the possibility of other publications wanting to do the same.
"Perhaps other enterprises will want to compete with Postmedia," he says.
On the other hand, there are concerns about the future of the newspapers under Postmedia's ownership.
"I hope this doesn’t come with the cutting of reporters on the ground," Lee says.
The proposed deal creates yet more distance between the owners of local news and the communities that rely upon local news, Greenspon points out.
The Green Party of New Brunswick is calling for measures that will see independent outlets supported and able to expand in the province.
"This is a priority given the purchaser of Brunswick News, Postmedia News, is a massive media conglomerate," party leader David Coon said in an emailed statement. "After it took a majority stake in Postmedia, newspapers were shut down, editorial operations were centralized and many people were laid off."
The provincial government declined to comment on the deal.
The purchase signals J.D. Irving's exit from the media business, said Jim Irving, co-CEO of J.D. Irving Ltd., in a statement.
"Postmedia is well-positioned to make the transition to the digital world of providing New Brunswickers with a reliable source of local, regional and national news as well as access to much broader news coverage,” Irving said.
Andrew MacLeod, president and CEO of Postmedia, said the acquisition will give the company a reach from coast to coast.
"The addition ... allows Postmedia to serve audiences and marketers from the Pacific to the Atlantic while we continue to build out a national distribution platform and network for our parcel delivery business," MacLeod said in a statement.
Brunswick's stable of daily newspapers in New Brunswick includes the Telegraph-Journal in Saint John, the Times and Transcript in Moncton and The Daily Gleaner in Fredericton.
Brunswick News also owns the Miramichi Leader, Woodstock Bugle-Observer, Bathurst Northern Light, Kings County Record, Campbellton Tribune and The Victoria Star, which covers the Grand Falls area of western New Brunswick.
The proposed deal includes acquisition of Brunswick's digital properties and parcel delivery business.
Postmedia Network Canada Corp. already owns 120 brands across multiple print, online and mobile platforms.
The transaction is subject to closing conditions.
— With files from Brett Bundale.
This report by The Canadian Press was first published Feb. 18, 2022.
Companies in this story: (TSX:PNC.A, TSX:PNC.B)
Adena Ali, The Canadian Press
Note to readers: This is a corrected story. A previous version stated that Grand Falls, N.B., is in eastern New Brunswick.