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Fairfax Financial Holdings Ltd. chairman and CEO Prem Watsa speaks during the company's annual meeting in Toronto April 11, 2013.

Harris/REUTERS

Investment manager Fairfax Financial Holdings Ltd. is paying about $12.8-million to expand its stake in media company Torstar Corp.

The Toronto-based firm, which is headed by Bay St. investor Prem Watsa, said Thursday that the move boosted its holdings by 3.4 per cent to nearly 23 per cent.

The purchase of an additional 2,385,000 class B shares was made at $5.35 per share for investment purposes, the company said.

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Torstar owns various media assets, including the Toronto Star news organization, free Metro daily papers and Harlequin books.

Earlier this month, Torstar reported relatively steady fourth-quarter profit of $20.6-million, compared with $21.1-million a year earlier.

Total revenue was $366.5-million, down 7 per cent from $395.7-million a year earlier, although the media division's revenue was up from the third quarter.

Watsa is known for taking risks, which have included betting against the U.S. housing bubble, which paid off when the market collapsed. He is also known for seeing value in companies that other investors miss.

Last year, Fairfax stood behind smartphone company BlackBerry with a $1-billion (U.S.) financing, further increasing its investment by another $250-million in January.

Torstar has struggled for years with the decline of the print newspaper industry and last summer launched a paywall on its website to convince more readers to subscribe to its content.

The media company's stock price has fallen dramatically from its all-time high of about $30 per share a decade ago.

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