Local news outlets have, of course, had problems in Canada and around the world for years. But now a lender has asked a Halifax court to break up the two companies that jointly own the most newspapers in Atlantic Canada outside of New Brunswick. And that opened up the possibility that the region could end up without any traditional news media other than broadcasters.
Much of the trouble with the two companies — which are jointly owned and whose holdings include The Chronicle Herald in Halifax and the Telegram in St. John’s, in Newfoundland, as well as The Guardian in Charlottetown – it’s theirs. They have either refused to cover, or paid very little, C$40 million in debt over the past five years. They owe the government just under $5 million in HST. and have financed operations using money from workers’ pensions.
But the move to break up the companies, and their corresponding filing to protect creditors, comes at a time when news outlets, big and small, face yet another major threat to their existence. My colleague David Streitfeld writes that “there are signs that the whole concept of ‘news’ is fading.” While he wrote about the United States, it appears that his findings apply to Canada as well.
[Read: How the Media Industry Keeps Losing the Future]
Dean Jobb, who teaches in the journalism program at the University of King’s College in Halifax, told me that the situation created by the potential collapse of the two companies, SaltWire Network and the Halifax Herald, could create a local news desert.
“It’s a real shock,” said Mr. Jobb, who worked as a reporter, editor and columnist at The Chronicle Herald for 20 years. “It is not an announcement of cuts or layoffs or the closing of one or two newspapers. It is potentially the region that will end up with very little media surviving in most of its communities.”
The Chronicle Herald traces its roots to 1824 and claims to be the oldest independent newspaper still in operation in Canada. It is currently owned by Mark Lever, its managing director, and Sarah Dennis. Ms Dennis is editor of The Halifax Herald and SaltWire, Mr Lever’s wife and the fourth generation of her family to control the Halifax newspaper.
In 2017, when the paper was in the midst of a strike that would last nearly 19 months, The Chronicle Herald’s parent company bought — from Transcontinental, a Montreal-based printer — a group of daily and weekly newspapers covering Atlantic Canada except New Brunswick. The merged entity was named SaltWire.
Instead of paying Transcontinental C$10 million, the purchase price for the deal, it sued the printing company for, in its view, misrepresenting the newspapers’ financial condition. This lawsuit is ongoing. A court earlier this month ordered SaltWire to deposit half a million dollars to ensure that Transcontinental’s legal bills are covered if SaltWire loses.
During the expansion, the companies borrowed C$32.7 million from Fiera, a Toronto-based private lender. In court filings, Fiera said the companies had defaulted on those loans for five years “and have no path or timetable to repay the credit facilities despite the patience of the lenders.”
For now, all newspapers and websites can operate as usual as they seek to protect creditors. Fiera is asking the court to force the sale of all holdings in the companies to cover the loans.
But Mr Jobb is among many observers who worry that buyers will not be found for many of the papers or that, if they are sold, the papers will become mere shells of what they once were. According to court filings, SaltWire lost C$4.1 million in its most recent fiscal year. Herald had a loss of $24.8 million, which the company attributes to pension liabilities.
While private broadcasters are cutting back on local news across Canada, the CBC continues to provide strong local coverage across Atlantic Canada. But Mr Jobb said this was likely to be significantly reduced if the Conservatives under Pierre Poilievre come to power in the next election and follow through on Mr Poilievre’s oft-repeated promise to scrap all state funding for the broadcaster’s English-language services. The CBC currently receives C$1.4 billion from the government for its English and French operations.
But even if the worst happens, there can be a positive development. Earlier this week, my colleagues wrote that a handful of media startups are finding success by learning from past mistakes.
[Read: Sprouts of Hope in a Gloomy Media Landscape]
While The Halifax Examiner is more of a general interest publication than these startups, it may benefit from any void left by SaltWire’s financial collapse.
“Tim Bousquet, the editor there, has done a fantastic job,” Mr Jobe said. “It’s made it into an award-winning news outlet and it’s certainly got some traction. Depending on what happens with SaltWire, maybe it will become more useful to more people.”
Trans Canada
Ian Austen, a native of Windsor, Ontario, studied in Toronto, lives in Ottawa and has reported on Canada for The New York Times for two decades. Follow him on Bluesky at @ianausten.bsky.social
HOW ARE WE GOING?
We look forward to your thoughts on this newsletter and Canadian events in general. Send them to nytcanada@nytimes.com.
Do you like this email?
Promote it to your friends and let them know they can sign up here.
