Postmedia buys Canwest newspapers division

After a long bankruptcy case, Postmedia make the $1.07bn acquisition.

Postmedia Network Canada Corp has announced that it has closed the deal on the $1.07bn acquisition of Canwest's newspaper division, after a long drawn bankruptcy court battle.

Canwest's titles include some of Canada's largest paid English-language newspapers including the National Post, Calgary Herald, Ottawa Citizen, the Vancouver Sun, and other big city dailies.

Canwest said its newspaper subsidiary successfully emerged from creditor protection under the ownership of Postmedia, whose CEO Paul Godfrey said the firm plans to apply for a listing on the Toronto Stock Exchange.

Godfrey also headed an ad hoc committee of senior holders who get a 45 per cent stake in Postmedia. The committee is making a $250m investment in the new company, which is backed by New York hedge fund Golden Tree Asset Management.

A Superior Court in Ontario gave its approval last month for Canwest to sell its newspaper division to a group of creditors led by Godfrey.