An organization that owns practically two dozen newspapers in Atlantic Canada has money owed of virtually $100 million and is submitting for creditor safety.
SaltWire Community made the appliance within the Supreme Courtroom of Nova Scotia, in keeping with court docket paperwork filed on Monday.
The court docket paperwork stated SaltWire has belongings of virtually $33 million and greater than $94 million in debt, with roughly a 3rd of that owed to its lender, Fiera Non-public Debt.
SaltWire additionally owes greater than $7 million in unpaid HST to the Canada Income Company, whereas the Chronicle Herald owes $2.6 million for missed pension plan funds, the paperwork stated.
Fiera’s attorneys filed an utility in court docket on Monday saying SaltWire does not have the belongings to pay again the cash it owes.
It stated the corporate has solely made one-third of its debt funds over the past 5 years, the court docket paperwork stated. The paperwork stated Fiera gave SaltWire till the top of January to ship a letter of intent illustrating how the debt will likely be repaid, however they didn’t hear again from the corporate.
Fiera stated SaltWire has been “demonstrably mismanaged” and has withheld cash from workers and pensioners.
Paperwork filed by Norton Rose Fulbright Canada LLP, which is representing Fiera, stated it misplaced religion in SaltWire’s administration group, which had “displayed a repeated failure to correctly handle” the enterprise.
Final week, SaltWire was ordered to pay $500,000 as a safety bond in connection to a separate authorized matter relating to the 2017 buy by SaltWire of greater than two-dozen Transcontinental newspapers.
SaltWire was additionally just lately ordered to pay $70,000 for failing to remain updated with pension plan funds.
A number of the firm’s every day newspapers embody the Chronicle Herald and the Cape Breton Publish in Nova Scotia, the Telegram in St. John’s, and the Guardian in Charlottetown. It additionally operates weekly newspapers.
What SaltWire is saying
In an announcement, the corporate stated submitting for creditor safety will assist guarantee the corporate’s long-term sustainability.
“SaltWire Community is assured that the … course of will allow us to emerge as a stronger, extra vibrant media firm,” stated chief working officer Ian Scott.
“We’re devoted to persevering with our legacy of offering insightful, native journalism and contributing positively to the communities we serve.”
Scott additionally stated the “unprecedented challenges” Canadian media have confronted lately and “pressures created by multinational social media networks” have negatively impacted the corporate’s monetary well being.
Union response
Willy Palov, president of the Halifax Typographical Union, which represents staff on the Chronicle Herald, stated it was arduous information to listen to, however correspondence he has seen from the corporate leaves room for optimism.
“They acquired a number of properties from Transcontinental and so they have pension debt and tax debt so these are exterior our sphere of affect,” Palov stated.
“We all know that these monetary challenges are what’s behind what is going on on now and revenues dropping does not assist that.”
College of King’s School journalism professor Stephen Kimber stated the corporate bit off greater than it may chew with its acquisition of regional newspapers.
He stated it was dangerous administration to purchase different newspapers by borrowing cash in a market that’s on a downward development.
“I do not assume they’d have been in nice form anyway simply due to the state of the business,” he stated.
“However they’re in terrible form now, and so they have largely solely themselves responsible.”
In line with Kimber, it might be sluggish and painful however in the end the corporate’s monetary place will consequence within the lack of two dozen newspapers.
