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Chicago Media Ownership

Chicago, IL: (Mar-25-08) Hollinger Inc. and the Sun-Times Media Group have been embroiled in a legal battle over a stock ownership structure, reaching back to the Conrad Black era, that gave Canada-based Hollinger 20% of the Sun-Times' stock but 70% of its voting shares. Conrad Black, the company's former CEO, is in federal prison for his role in swindling Hollinger International shareholders out of millions of dollars.

In a recent development in the case, spokespersons announced that the two parties have reached a settlement, resolving pending litigation between the companies. Under the terms of the settlement agreement, the deal would reverse the stock ownership structure, in which Hollinger would receive 20% of regular Class A stock and give up its voting control in exchange. The companies claimed that the proposal is set to be approved by the Ontario Superior Court of Justice and the United States Bankruptcy Court for the District of Delaware.

Per the terms of the deal, six directors that Hollinger appointed to the Sun-Times board last summer will resign. Hollinger will also reimburse Sun-Times $1 million in legal expenses that the company incurred during the takeover. The Sun-Times Media Group, the publisher of the Chicago Sun-Times and scores of smaller newspapers in the metropolitan area, was known as Hollinger International Inc. until July 2006. The settlement does not end litigation filed by the Sun-Times against Conrad Black. [CBS 2 CHICAGO NEWS: SUN-TIMES MEDIA GROUP, HOLLINGER REACH SETTLEMENT]

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Published on Mar-26-08


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