Sun Media Corporation Announces Transactions

Posted on July 20, 1998

Sun Media Corporation announced it has reached a conditional agreement to acquire four daily newspapers from Southam Inc. and Hollinger Canadian Publishing Holdings Inc., The Hamilton Spectator, The Record (Kitchener-Waterloo), The Cambridge Reporter and The Daily Mercury (Guelph) with combined daily circulation of approximately 200,000. In addition, Sun Media has agreed to sell its 80% interest in The Financial Post Company to Southam Inc. The Financial Post has circulation of approximately 100,000 daily and approximately 200,000 for its weekend edition.

The acquisition of the four dailies, along with the previously announced pending acquisition of The Brockville Recorder and Times, gives Sun Media 15 of Canada's 105 daily newspapers and a 16% share of the national circulation. The acquisition will give Sun Media daily newspapers in seven of Canada's top 11 markets.

``We take great pride in having built the Post into a major media franchise,'' said Paul Godfrey, President and Chief Executive Officer of Sun Media. ``As such, the decision we have taken came with a great deal of reluctance and only after much soul-searching. I always said that we did not wish to sell the Post for cash because, as a company, it is our objective to build on our already-strong newspaper base as well as expanding into other media. Only through a transaction such as this, in which we acquire established dailies in two of Canada's largest markets, could we have accomplished that goal. We believe this transaction is in the best long-term interests of our shareholders.''