TC Media sells 15 consumer magazines to TVA Group, including Canadian Living and The Hockey News
By Carys Mills
Transcontinental Inc. is selling its consumer magazines produced in Montreal and Toronto, including Canadian Living and The Hockey News, to Quebecor Media’s TVA Group.
The $55.5-million sale, which still needs Competition Bureau approval, will transfer Transcontinental’s ownership of 15 magazines to TVA. Industry watchers say the deal will further consolidate media ownership in Canada, potentially eliminating jobs and lowering the number of companies to which freelancers can sell their work.
In a statement, Transcontinental president and CEO François Olivier cited the “highly competitive magazine industry” and the “migration of advertising revenues towards digital media” as reasons to zero in on local advertising vehicles instead of magazines.
“We decided to focus on the segments…where we think we have a right to win,” said Katherine Chartrand, director of communications of Transcontinental’s TC Media. “So, the segments identified as giving us a sustainable, competitive advantage.”
One of the company’s goals is to focus on local advertising, said Chartrand, adding discussions with TVA have been happening for a few months. Transcontinental is already involved in door-to-door delivery of advertisements and owns about 180 newspapers in Quebec, Ontario, Saskatchewan and the Atlantic provinces.
But Transcontinental isn’t getting out of the magazine business altogether. It will hold onto Vancouver Magazine and Western Living. Another part of the deal is an agreement that Transcontinental will print magazines for TVA for seven years.
In Montreal and Toronto, about 310 people work for the magazines being sold. The employees are part of the transaction, Chartrand said. “But as for what TVA wants to do, it’s not up to us to discuss,” she said.
D.B. Scott, a magazine industry consultant and blogger, said the sale came as a surprise to him but he can see why it benefits Transcontinental. “I’m not sure it’s good for the 300-odd people who work for them,” he said.
TVA spokesman Martin Tremblay did not return requests for comment about the deal and jobs on Monday. TVA president and CEO Julie Tremblay said in a statement that the acquisition will add between $10 million and $14 million to annual operating earnings.
“This transaction will enable us to capture significant operational synergies and secure the segment’s long-term profitability and viability,” Tremblay said.
If the deal goes through, TVA will become the sole owner of Coup de pouce, Canadian Living, Véro Magazine, Décormag, Style at Home, Fleurs Plantes Jardins, Canadian Gardening, Québec Vert, The Hockey News, MaisonsNeuves.com, Condo Maison Direct, plus recettes.qc.ca, Quoi manger and On the Table websites.
As well, TVA will hold 51 per cent of shares in Les Publications Transcontinental-Hearst Inc., which publishes Elle Canada and Elle Québec magazines. Hearst Group has a 49 per cent share.
TVA will also gain a 50 per cent share in Publications Senior Inc., which publishes Le Bel Âge and Good Times magazines. The other 50-per-cent share is held by Bayard Group.
Carleton University journalism professor Dwayne Winseck said it’s important to look at other recent deals to get a full picture of the consolidation taking place in the industry.
Transcontinental acquired some Quebec weekly papers from Sun Media last year. Then, earlier this year, Postmedia announced it had made a deal with Quebecor to buy Sun Media’s English newspapers.
“There’s a lot of title swapping going on within both (magazine and newspaper) sectors, and it seems to me that what we’re seeing is Quebecor stepping out of newspapers and consolidating its position within magazines,” Winseck said. “Transcontinental is doing the same kind of thing, consolidating its position within newspapers and getting out of magazines.”
The magazine industry currently has the least ownership concentration of all media sectors that Winseck looks at, he said. But the new deal will put TVA on par with Rogers Publishing, he said.
“In this case, magazine journalists, writers, editors, freelancers, have lost a big door to knock on with Transcontinental and now have to go line up at the doors of Quebecor,” Winseck said.
Chartrand said she’s not sure when the sale will go to the Competition Bureau. As for concerns about media consolidation, she said it’s necessary.
“It’s part of the context of the media industry today in Canada,” she said. “In this context, magazines and papers and print media, it needs to be consolidated to ensure future growth and to compete with all the digital platforms.”