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CanWest gets $50 million worth of good news

An arbiter has ruled on a long standing legal dispute stemming from the deal CanWest struck to buy a chain of newspapers from Conrad Black’s Hollinger media empire.

Bottom line: CanWest will get C$50.7 million, plus interests and costs to be determined later, from the Sun-Times Media Group, formerly Hollinger International.

The news couldn’t have come at a better time for CanWest, which has frozen hiring, salary increases and other categories of spending in the face of declining advertising revenues. CanWest is Canada’s largest media corporation, with a string of television stations and major daily newspapers including The National Post, the Vancouver Sun, The Vancouver Province and the Victoria Times-Colonist. In recent months its share price has hovered between 50 cents and a dollar after grazing 15 dollars in mid-2006.

CanWest posted a C$33 million loss for the first quarter of this year, and earlier this month CEO Leonard Asper said the company may have to sell assets to stay alive.

Editor and Publisher magazine reports that Sun-Times Media is considering appealing the arbiter’s decision to the Ontario Superior Court.

Canwest originally said Hollinger owed it C$84 million (US$69 million), while Hollinger claimed CanWest owed it C$116 million (US$95.2 million).

“While the proceedings have been protracted over several years, we obviously feel justified that the time and effort it took to pursue the claim has been worth it,” Canwest CEO Leonard Asper said in a statement published in the Editor and Publisher report.

David Beers is editor of The Tyee.

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