Under new owners
Twenty years ago, when newspapers were still strong enough to go to war against each other, David Asper went out of his way to take a shot at the Toronto Star, which he said printed "irrational tirades" and was where "a dead owner is controlling the show."
The Asper family at the time owned Canwest Global, which had gobbled up Southam's chain of newspapers to join Izzy Asper's Global TV network. It came under fire when it ordered all its papers to run self-serving editorials dictated by head office in Winnipeg. The Toronto Star was a strong critic, arguing that they undermined editorial independence and were an abuse of chain ownership.
In 2001, David Asper struck back in a speech in Oakville, a city on Toronto's doorstep which just happened to be home to the descendants of Joseph E. Atkinson, the owner who built the Star into Canada's largest circulation newspaper.
Deriding the Star, Asper said: "Nothing that appears in the editorial section of the paper can deviate from Mr. Atkinson's five principles of social democracy. Okay, so Atkinson doesn't sit in on the editorial meetings, but his spirit sure does. In the case of the Star, a dead owner is controlling the show. At least in our case I'm actually here and accountable! (as are my father and brother in Winnipeg)."
He asked: "Is John Honderich, the publisher of the Star, another puppet hiding behind the dead hand control of a previous owner?"
Ironically, the Aspers' ham-handed proprietorship soon drove Canwest into bankruptcy, while the Star -- with its Atkinson Principles intact -- lived on.
That anecdote came to mind this week when Torstar, the company that controls the Star and six other daily newspapers in Ontario, announced it will be sold, ending 63 years of control by a unique voting trust formed by five families who pledged in 1957 to carry on Joe Atkinson's legacy. The bargain-basement purchase price of $52 million reflected the grim toll on daily newspapers exacted by social-media advertising, changing reader tastes and the COVID-19 pandemic.
A key part of the announcement was that the new owners -- NordStar Capital, owned by Toronto entrepreneurs Jordan Bitove and Paul Rivett -- have pledged to preserve the values first articulated by Holy Joe Atkinson more than a century ago. The so-called "Atkinson Principles" champion social justice, anti-discrimination, organized labor and Canadian nationhood.
Contrary to public belief, Atkinson never actually wrote down his principles. They were written for him in 2001 by John Honderich, who told me he did so at the specific direction of CEO Rob Prichard. At that time, Torstar was bidding for the lucrative Toronto One TV license, and Prichard believed the Canadian Radio-television and Telecommunications Commission liked to see public mission statements on its licensees' websites. So Honderich wrote it, based on Atkinson's legacy and the interpretation of it by John's father and longtime publisher Beland Honderich. Ironically, Torstar lost its license bid and Honderich had a falling-out with Prichard and spent a few years in the wilderness before fighting back as head of the voting trust.
The sale ends a remarkable 128-year history of an independent newspaper that once sent Ernest Hemingway to cover war, Milt Dunnell to cover games, Nathan Cohen to cover culture, Gordon Sinclair to cover life and Duncan Macpherson to poke fun at the powerful. Atkinson's formula to cover news was simple: "Get it first, wrap it up, cover every angle, and play it big." Even after the paper's fortunes began to decline in the 1990s, that passion for news gathering burned in the veins of its editors, reporters and photographers.
Bitove and Rivett, the new owners, say "we believe in news" and that their ownership will ensure a future for "world-class journalism." That remains to be seen. The future of media in this country seems to be in non-profit, public-interest journalism delivered online, not corporate chains with well-heeled private interests. Their plan is to make Torstar a private company, which gives them unchecked power with less public scrutiny.
Will rich, conservative owners continue to champion the Star's brand of aggressive investigative journalism, which has examined tax havens the rich use overseas, and the abuses of profit-hungry owners of private nursing homes that proved to be breeding grounds for COVID-19? Defending and strengthening that investigative mandate may be John Honderich's most important achievement.
In the end, the voting trust was author of its own doom. It failed to turn itself over to a third generation. Several grandsons and granddaughters of the original trust, including John Honderich's two children, were given shots at the company but came up short. At least the new ownership will spell an end to the outrageous nepotism which saw the voting trust peppering its board of directors with relatives of the Honderich, Atkinson, Campbell, Thall and Hindmarsh families.
The writing has been on the wall since October 2019, when Torstar eliminated dividend payments, which were a boon to investors but also the source of the fortunes earned by members of the trust. Under the arrangement, if dividends were suspended for eight straight quarters, the trust would lose its exclusive voting privileges, and power would be shared by everyone who owned B shares. Forty percent of B-shares are owned by Fairfax Financial Holdings Limited, the company Rivett recently retired from.
Whatever their plans, Bitove and Rivett have made a sweet deal. Wednesday's Star story said Torstar, at the end of the first quarter, was debt free and had $69.4 million in cash and cash equivalents. Meaning, if the new owners are predatory and choose to milk the company dry, the five families will have paid them more than $17 million to take the paper off their hands.
That sound you hear might be Holy Joe spinning in his grave.