The decision was expected, but not the way in which it emerged. Late in October, Toronto-based Southam Inc. had announced plans to sell its money-losing Financial Times of Canada. By early last week, editorial staff members at the Times fully expected that The Globe and Mail would take over the 77-year-old business weekly. Still, most of the Ti mes’ editors and writers received initial confirmation of the Globe's takeover not from company executives, but from an early afternoon report on CBC TV’s Newsworld channel. Later in the day, Globe publisher A. Roy Megarry arrived at the Ti mes ’offices to make it official. He announced that Thomson Newspapers Corp., owner of the Globe, had purchased the financially troubled Times from Southam for an undisclosed sum, estimated among industry observers at about $9 million.
One of the new owner’s first acts was to dismiss publisher and editor John Macfarlane,
47, who piloted the paper through an extensive overhaul two years ago. Barbara Hyland, the Times’ new publisher, said that there would be no other immediate changes in the Timed 30member editorial staff. For his part, managing editor Michael Posner said that he hoped the new owners would be able to improve the weekly’s financial situation. Said Posner: “I think this will do good things for the Times and its visibility in the marketplace.”
The sale marked a strategic withdrawal by Southam from the fierce circulation war that had been waged for the past two years by three Toronto-based business publications: the weekly Times; the Globe’s daily Report on Business; and The Financial Post, which is owned by the Toronto Sun Publishing Corp., the Financial Times of London and Conrad Black’s Hollinger Inc. (The Toronto Sun Publishing Corp. is partly owned by Maclean Hunter Ltd., which publishes Maclean’s.) The Post went from weekly to five-days-a-week publication in 1988. Industry observers said that the purchase of the Times appeared to present the Globe, which will manage the weekly for Thomson Newspapers, with a chance to improve its competitive position.
The key question was how the Globe would choose to use its new acquisition. Hyland, who was promoted from her job as the Globés director of information and marketing services, said that the Globe planned no major changes at the Times until it has done extensive research. In the past, Globe and Mail executives have indicated that they were considering a Sunday
edition of their newspaper, which currently publishes she days a week. Hyland dismissed reports that the Times might serve as a vehicle for launching the Globe into the Sunday market in the near future. “This is not a Sunday Globe and Mail," she said.
The sale of the Times ended a costly attempt by Southam to capture a wider market for the paper, which by 1987 had a circulation of only 105,000. In January, 1988, Southam launched a revamped version of the Times, with a distinctive new layout and a heavier emphasis on analytical and feature articles. Although many journalists expressed admiration for the redesigned Times, it did not attract a large new readership. Macfarlane blamed intense competition and dwindling demand for investment news following the stock market crash of October, 1987. By last week, the Timed weekly circulation stood at 118,000, compared with
210,000 for the Post’s weekend edition.
The Times’ efforts to carve out a position in a hotly contested marketplace was a costly enterprise. The paper lost more than $10 million in 1988 and 1989. Southam officials said that the firm, which is currently in the midst of a corporate reorganization aimed at improving share values and reducing the company’s vulnerability to a possible takeover, was no longer prepared to lose money on the paper. Said Brian Butters, Southam’s director of investor and corporate communications: “tí we had the luxury of unlimited time and financial resources, we would have stuck with it. But we don’t.”
In the wake of Thomson’s purchase, some Times staff members said that they feared the departure of Macfarlane might signal the Globe’s intention to change dramatically the Times’ thrust in the future. That could involve shifting the Times away from its present broad
coverage of financial news to an investororiented publication.
Some industry observers said that the Times may indeed need another overhaul if it is to become a money-making concern. Said Derrick Leach, communications analyst with the Toronto investment house of Deacon Morgan McEwen Easson: “Up to now, the Times hasn’t served a large enough segment of the national advertising market to keep its belly full.” A Sunday business paper, he added, would make sense for the Globe because it would not threaten the paper’s existing Report on Business advertising revenues. Meanwhile, at the Timed offices, editors said that the recent period of suspense and turmoil within the paper would not affect editorial quality. Clearly, it was business as usual at the Financial Times—for the time being, at least.
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