David George-Cosh

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The head of Canada's largest union said he isn't worried that the proposed privatization of Torstar Corp. could result in mass layoffs or an eventual merger with Postmedia Network Canada Corp.

Former Fairfax Financial Holdings Ltd. President Paul Rivett and Canadian entrepreneur Jordan Bitove — both of whom are partners at NordStar Capital LP, the firm that plans to take Torstar private — invited Unifor National President Jerry Dias to lunch earlier this week to discuss their plans for the 128-year-old publisher. 

"I've met with both Paul and Jordan. We had a very straightforward conversation on vision and their vision is not to go down that road [of a merger]," Dias said in a phone interview with BNN Bloomberg. 

"They want to keep the integrity of The Star. There's no move to turn it into an extension of The National Post." 

Paul Godfrey,  executive chairman of Postmedia, declined to comment on "rumors or speculative matters​" when asked by BNN Bloomberg about whether the newspaper chain would soon merge with Torstar under a successful NordStar bid. 

Torstar's voting trust, which controls the company's Class A shares, accepted a sweetened offer from NordStar to be sold for 74 cents per share. A shareholder vote is scheduled to take place on July 21, but a competing – and potentially higher - bid from Canadian Modern Media Holdings Inc. wasn't tabled to the voting trust. That move has drawn the ire of several Torstar shareholders who want the Ontario Securities Commission to investigate the NordStar deal, claiming it may not be in the best interest of shareholders. 

However, Dias said his concerns about layoffs or a merger with Postmedia were allayed after meeting with the NordStar group. 

"I was apprehensive going into the conversation but I left feeling more comfortable," Dias said. 

He noted that Torstar's fortunes have mirrored a broad decline seen across the Canadian media landscape. Dozens of newspapers have folded and hundreds of journalists have been laid off in recent years as a result of plunging revenue in the sector. 

"The major preoccupation with Torstar over the past year was survival," Dias said. "The writing was on the wall last year when they missed their first dividend payment. We knew that if they missed four quarters of dividend payments, they'd be in trouble." 

Dias added that the Canadian government needs to start taxing companies like Alphabet Inc.'s Google, Facebook Inc., and Netflix Inc., as online advertising - a key revenue stream for Canadian media players - gets siphoned away by foreign firms. 

"The government just needs to have the courage to take them on," he said.