Postmedia's President and C.E.O Paul Godrey sits in his office following a news conference in Toronto on Monday October 6 , 2014, during which he announced an agreement with Quebcor to purchase Sun Media's 175 English Language newspapers, speciality publications and digital properties in a deal worth $316 million.Chris Young
For Paul Godfrey, Postmedia Network Canada Corp.'s purchase of Sun Media Corp.'s English-language newspapers was borne of necessity, not nostalgia.
While Mr. Godfrey, Postmedia's chief executive officer, spent a decade and a half in the Sun newspaper group and referred to the deal at a press conference Monday as a "homecoming" and a "family reunion," he said his attachment to the Sun group was not a factor.
This deal was done for "business reasons, not sentimental reasons," Mr. Godfrey, 75, said in an interview. "It was a necessity to join Postmedia and Sun Media. Together, they are stronger. Separated, they would both be in serious trouble to survive in the future."
Still, he said, he has heard from several former and current employees of the Sun group, and "some of them said they are doing victory laps of the building" because of the pending Postmedia takeover.
The merger is crucial because the newspaper business is an ailing industry, Mr. Godfrey insists, and only by joining forces can the two companies have the digital impact to contend with its real competitors, international powerhouses such as Google, Facebook and Twitter.
But the deal, if it goes through, will also vault Mr. Godfrey to the top of Canada's largest media conglomerate, putting him among the ranks of earlier media moguls such as Conrad Black, Izzy Asper and Ken Thomson.
It is a big leap from Mr. Godfrey's first entry into the newspaper business in 1984, when he took over as publisher of The Toronto Sun after five terms as the larger-than-life chairman of Metropolitan Toronto. At the time, he acknowledged that he knew little about newspapers but was willing to learn. "I know a lot about people and I know a lot about handling problems. I consider myself a generalist," he said.
His 16-year tenure at the Sun, first as publisher of the Toronto paper but later as CEO for the entire organization, was marked by several blockbuster deals. In 1996, he led an employee buyout of the paper, keeping it out of the hands of Pierre Péladeau's expansionist Quebecor after the Sun's owner – Rogers Communications Inc. – decided to sell its majority holding.
While there was elation in the ranks following the deal, Mr. Godfrey showed he was equally comfortable being hard-nosed. Less than a month after the employee buyout closed, he laid off 100 employees in order to cut costs.
Two years later, Quebecor had morphed from the villain into a white knight when it emerged to outbid a hostile takeover proposal from Torstar Corp. Quebecor paid almost $1-billion for Sun Media, and the deal made Mr. Godfrey a rich man, since he owned a significant block of the company's shares.
Then, in 2000, Mr. Godfrey left the Sun organization after Quebecor tightened up its hold on the company. "I'm used to being at the controls," Mr. Godfrey said at the time.
He ran the Toronto Blue Jays organization for eight years, then returned to the publishing business in 2008 as president and CEO of the National Post. A year later, he organized a buyout of the other CanWest daily newspapers, creating Postmedia Network.
By adding Sun Media's English newspapers to that group, he will end up running an empire of unprecedented proportions. But Mr. Godfrey doesn't see himself as a media baron in control of the country's news. "I don't look at my self that way," he said. "I recognize and appreciate that there is a business side to newspapers, and there is a news side to newspaper. I'm going to leave the news side to the experts."
Douglas Knight, who served as publisher of the Financial Post when it was part of the Sun organization, and publisher of The Toronto Sun, said Mr. Godfrey clearly has fond memories of his time at Sun Media, but "I don't think Paul would lead a transaction like this for purely nostalgic reasons."
Mr. Knight, now president of the media group at St. Joseph Communications in Toronto, said Mr. Godfrey is one of the most experienced newspaper proprietors in Canada. If anyone can get spending in line and control costs, it is Mr. Godfrey, he said. "He has a team that knows where every bolt on the bus is."
With a report from James Bradshaw
Editor's note: An earlier version of this story misspelled the surname of Kenneth Thomson, the late media proprietor.