CALGARY — An architect of one of the few successful media employee buyouts in Canada says knowing the market and enlisting help from sympathetic investors have been key to the survival of CHEK TV since it was saved from closing in 2009.
Still, eight years later, the independent Victoria TV station has yet to pay out a dividend — and, while staff kept their jobs, they have also had to accept hardships like wage rollbacks to prevent layoffs, said Rob Germain, CHEK's news director and a board member.
He gave an interview as employees of the Prince Albert Daily Herald in Saskatchewan continue to negotiate to buy their 134-year-old newspaper from owner Star News Publishing Inc. of Alberta.
"I certainly admire them and if they feel there's a market for it, then that's half the battle — knowing there's a demand for your product is the most important of all," Germain said when asked what advice he would provide.
The Daily Herald buyout was announced in December but publisher Donna Pfeil said it has not yet been finalized, although both the employees and Star News president Roger Holmes want it to go through.
She said advertisers and readers in Prince Albert have been vocal in their support of the local newspaper.
"We're still in negotiation. It's kind of a waiting game," she said, adding she can't say how much the buyout will cost, nor how the ownership group will be structured or whether outside investors will be invited in.
"We're not giving out too much information," Pfeil said. "Every employee is contributing what they can contribute to have the paper continue and move forward."
Holmes confirmed the deal isn't done but wouldn't give further comment.
Star News has said it intends to sell or close all of its Saskatchewan newspapers. Last month, it shut down the daily Moose Jaw Times-Herald, one of 13 Saskatchewan titles it bought from Transcontinental Inc. in 2016.
Germain said CHEK, founded in 1956, was included in a list of TV stations that then-owner Canwest Global Communications Corp. put on the sales block in 2009. When a deal failed to materialize, the workers were given layoff notices and its closure was announced.
Three dozen employees put up $15,000 each but it wasn't enough. Although the station was being sold for $2 and was debt free, outside investors including the Communications Energy and Paperworkers Union were recruited to take the total to $2.5 million to provide short-term operating funds.
Germain said the key investment of both cash and advice came from Levi Sampson, who is chairman of the board. He is also the largest single shareholder, although he has less than 50 per cent of the equity.
Sampson is president of Harmac Pacific and led an employee buyout to reopen its mothballed pulp mill near Nanaimo, B.C., in 2008.
"He and his family ended up coming on board as investors in our company and they are true angel investors," Germain said. "They really just wanted to save the jobs at the station and have been there ever since."
Germain said there have been "challenges" for the TV station, including hiring more staff to take over functions previously handled by Canwest head office.
Meanwhile, any profits have had to be redeployed to upgrade equipment and keep up with ever-changing technology.
The station has relied on programming funds from the Canadian Radio-television and Telecommunications Commission for as much as a fifth of revenue in some years, Germain said.
He said CHEK TV has more local advertisers than national now and is doing more local programing than ever, a source of pride for the employees. The station is unionized and staff take an active role in management decisions.
"I said if we made it 10 years it would be a success and we'll be coming up to nine years in September," Germain said. "I've got no doubt we will be continuing beyond the 10 years."