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Canwest$1.1 Billion Newspaper Sale Approved by Judge (Update2)

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Canwest$1.1 Billion Newspaper Sale Approved by Judge (Update2)
May 17,2010, 6:47 PM EDT
By Hugo Millerand Joe Schneider
May 17(Bloomberg) — Canwest Global Communications Corp. said an Ontario courtapproved the C$1.1 billion ($1.06 billion) sale of its newspaper chain to agroup of creditors led by Canadian media executive Paul Godfrey.
The salesanctioned by Ontario Superior Court Judge Sarah Pepall will provide jobs forall of Canwest’s full-time employees and “substantially all” of its part-timeworkers, Winnipeg, Manitoba-based Canwest said today in a statement.
Godfrey,former chief executive officer of the National Post newspaper, and a group of creditors lastweek won a court- monitored auction, beating out a C$925 million minimum bidfrom lenders including Bank of Nova Scotia, and an offer from Torstar Corp.,owner of the Toronto Star. Canwest was forced to sell assets after filing forbankruptcy protection in January.
A thirdbid, from an unidentified group, was also rejected, according to papers filedby FTI Consulting, the court-appointed monitor.
Thesale must still be approved at a June 10 meeting by unsecured creditors, who will consider it as part ofa vote on Canwest’s newspaper division’s plan to exit bankruptcy. Pepall todayapproved the meeting and the date, Canwest said.
Canwestoperates Canada’s biggest newspaper chain with 12 dailies including the Vancouver Sun,Montreal Gazette and Ottawa Citizen as well as the National Post. The companyalso publishes 45 community and free newspapers.

Tocontact the reporter on this story: Hugo Miller in Toronto athugomiller@bloomberg.net; Joe Schneider in Toronto atjschneider5@bloomberg.net.

The exitplan includes the sale of the newspapers to a group of bondholders led by Canadianmedia executive Paul Godfrey, who had agreed on May 10 to buy the assetsfor C$1.1 billion ($1.1 billion).
Godfreyand the bondholders, known as the ad hoc committee, or AHC, beat out two otherbidders for the newspapers, Douglas Lamb, a senior employee at CanwestPublishing, said in court documents. Torstar Corp., publisher of theToronto Star, said the winning bid was more than it was prepared to pay. Lambdidn’t name the other bidders.
“The LPentities are firmly of the view that the AHC transaction represents the bestavailable outcome for the business,” Lamb said.
Canwest,based in Winnipeg, Manitoba, operates Canada’s biggest newspaper chain with 12dailies including the Vancouver Sun, Montreal Gazette and Ottawa Citizen. Thecompany also publishes 45 community and free newspapers as well as the NationalPost

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