Torstar, the owner of the Toronto Star and other Canadian media outlets, has received an acquisition offer rivaling the one made in May by NordStar Capital. Torstar’s board has determined that the new offer “may reasonably be expected to constitute or lead to a superior proposal.” The new bidder or bidders were not disclosed. The Globe and Mail reports they include businessmen and brothers Matthew and Tyler Proud.
TORONTO, ONTARIO – (CNW – July 9, 2020) – In response to a request from the Investment Industry Regulatory Organization of Canada and following recent press reports, Torstar Corporation (TSX: TS.B) (“Torstar”) confirmed today that it has received a non-binding unsolicited offer from a private investor group (the “New Offeror”), pursuant to which the New Offeror has offered to acquire all of the issued and outstanding Class A shares and Class B non-voting shares of Torstar (the “New Offer”).
The New Offer is conditional on, among other things, the completion of confirmatory due diligence, the negotiation of definitive documentation in respect of the New Offer and the entering into of voting support agreements with the New Offeror by the trustees of the Torstar Voting Trust, the Torstar directors holding Shares and Hamblin Watsa Investment Counsel Ltd., an affiliate of Fairfax Financial Holdings Ltd.
The Torstar board of directors (the “Board”) has determined that the New Offer may reasonably be expected to constitute or lead to a “Superior Proposal” under the arrangement agreement dated May 26, 2020 (the “NordStar Agreement”) entered into between Torstar and NordStar Capital LP (“NordStar”), and is engaging in discussions and negotiations with the New Offeror regarding its non-binding proposal.
In connection with the execution of the NordStar Agreement, the Board determined that the transaction contemplated by the NordStar Agreement is in the best interest of the company. The Board continues to recommend that Torstar shareholders vote in favour of the NordStar transaction at the special meeting of Torstar shareholders scheduled to be held on July 21, 2020 (the “Special Meeting”).
The Board will continue to consider the materials provided by the New Offeror, including the terms of any financing contemplated by the New Offer, but no determination has been made at this time that the New Offer constitutes a “Superior Proposal” under the NordStar Agreement. In addition, if determined to be a Superior Proposal, the New Offer remains subject to a right to match granted by Torstar in favour of NordStar pursuant to the NordStar Agreement. There can be no assurance that the New Offer will be determined by the Board to constitute a Superior Proposal or lead to a termination of the NordStar Agreement and the execution of a definitive agreement with the New Offeror.
Shareholders who have questions regarding the NordStar transaction or require assistance with voting may contact Torstar’s transfer agent as provided for in the management information circular delivered to Shareholders in connection with the Special Meeting.
Torstar does not anticipate issuing any further public statement regarding the New Offer except as required by applicable law.
About Torstar Corporation
Torstar Corporation is a broadly-based media company listed on the Toronto Stock Exchange (TS.B). Its businesses include the Toronto Star, Canada’s largest daily newspaper, six regional daily newspapers in Ontario including The Hamilton Spectator, and more than 70 weekly community newspapers in Ontario; flyer distribution services: and digital properties including thestar.com (with local editions in Toronto, Vancouver, Calgary, Edmonton, Winnipeg, Ottawa and Halifax), wheels.ca, toronto.com, save.ca, a number of regional online sites and eyeReturn Marketing. It also holds a majority interest in VerticalScope, a North American vertically-focused digital media company.