* At the request of CanWest Global Communications, the New York Supreme Court has issued a temporary restraining order stopping Mirkaei Tikshoret from making any changes at The Jerusalem Post.
* At stake may be the paper's assets, format, location and political outlook.
CONTENTS
1. "CanWest accuses Azur of extortion" (By Yael Gaoni, Globes, January 27, 2005)
2. "CanWest to fight for Jerusalem Post stake. Israeli publisher 'reneged,' says Asper. CEO vague about tabloid strategy" (Toronto Star Business Section, January 28, 2005)
3. "Azur, Asper family disagree over Jerusalem Post deal," (By Yael Gaoni, Globes, January 25, 2005)
NOTE AND SUMMARY
[Note by Tom Gross]
This email dispatch charts the latest developments regarding the sale of the Jerusalem Post and the ongoing dispute between its new owners.
Because this dispatch does not concern Middle East politics, but technical matters to do with the media, it will probably be of more interest to journalists and media analysts on this list, rather than others.
The Canadian company CanWest Global Communications, jointly bought the Jerusalem Post, with the Israeli company Mirkaei Tikshoret, after it was put up for sale last year by Hollinger International (former owners of the London Daily Telegraph, Sunday Telegraph, Chicago Sun-Times, and a host of Canadian national and American regional newspapers.)
CanWest also publishes Canadian papers such as the National Post and Ottawa Citizen. The chairman of the CanWest board, Frank McKenna, is due to become Canada's ambassador to the U.S. next month.
The Toronto daily The Globe and Mail reports that Aviv Bushinky, a media advisor to Benjamin Netanyahu when he was prime minister who was appointed publisher of The Jerusalem Post by both parties, told the newspaper's staff that its printing plant, business and administration offices would be moved to Tel Aviv, and the newspaper's building site sold. He said that The Jerusalem Post editorial offices would remain in Jerusalem.
A dispute has now arisen over this and other matters.
I attach three pieces concerning this – two articles from Globes, and one from the Toronto Star.
(For those that don't know, Globes is the daily business newspaper published in Tel Aviv, the Israeli equivalent of the US-based Wall Street Journal or the UK-based Financial Times.)
-- Tom Gross
CANWEST ACCUSES AZUR OF EXTORTION
CanWest accuses Azur of extortion
At the request of CanWest Global Communications, the Supreme Court of New York issued a temporary restraining order stopping Mirkaei Tikshoret from making any changes at "The Jerusalem Post".
By Yael Gaoni
January 27, 2005
Globes
The struggle between Eli Azur and CanWest Global Communications Corp. (NYSE: CWG; TSX: CGS) over their joint control of "The Jerusalem Post" is heating up. The deal has not gone forward to date. Toronto daily "The Globe and Mail" quotes CanWest as accusing Mirkaei Tikshoret Ltd., controlled by Azur, of "extortion".
"The Globe and Mail" reports that Aviv Bushinky, a media advisor to Benjamin Netanyahu when he was prime minister who was appointed publisher of "The Jerusalem Post" by both parties, told the newspaper's staff that its printing plant, business and administration offices would be moved to Tel Aviv, and the newspaper's building site sold. He said that "The Jerusalem Post" editorial offices would remain in Jerusalem.
"The Globe and Mail" reports that CanWest said that Mirkaei Tikshoret paid Hollinger International Inc. (NYSE:HLR) $13.2 million in cash for "The Jerusalem Post", after problems arose with CanWest over their agreement for joint ownership of the newspaper. CanWest has not yet transferred to Mirkaei Tikshoret the $6.6 million.
Mirkaei Tikshoret said in response, "The company will not be dragged into a campaign of slander that the other party is trying to present. Unquestionably, there is a deep chasm between Mirkaei Tikshoret and CanWest, which cannot be bridged.
"There are different attitudes and world views between the two groups. Since the chasm cannot be bridged, it is unclear why CanWest, through its campaign of slander, wants to be a partner of Mirkaei Tikshoret."
"Globes" reported yesterday that sources close to the deal had said recently that one of the reasons why CanWest has not yet transferred the money to Mirkaei Tikshoret was its expectations of easier terms and monetary discounts in the agreement signed between the parties signed six weeks ago.
Several days ago, CanWest, controlled by the Asper family, announced it was taking the dispute to arbitration in a New York court. At CanWest's request, the Supreme Court of New York issued a temporary restraining order stopping Mirkaei Tikshoret from selling any of "The Jerusalem Post's" assets, firing employees, or making other changes at the newspaper.
After the deal was signed, sources claimed that Azur wanted sole control of "The Jerusalem Post" out of concern that CanWest would continue the paper's right-wing editorial policy. Now that Azur knows how much the newspaper and its premises are worth, estimated at $7 million, it cannot be ruled out that he realized the deal was even more worthwhile without the Canadians.
CANWEST TO FIGHT FOR JERUSALEM POST STAKE
CanWest to fight for Jerusalem Post stake
Israeli publisher 'reneged:' Asper
CEO vague about tabloid strategy
By David Bruser
Business Reporter
Toronto Star
January 28, 2005
CanWest Global Communications Corp. CEO Leonard Asper reiterated yesterday the company's desire to buy a stake in the Jerusalem Post, even if it means a court battle with the Israeli publisher that was supposed to share ownership.
The 2004 purchase of the Jerusalem Post from Hollinger Inc. stipulated that Mirkaei Tikshoret Ltd. would buy the paper and sell CanWest a 50 per cent interest, but MTL "reneged," Asper said.
"I think what's happened is they liked it so much, they wanted the whole thing," he added. "As little interest as I have in working with people who treat us this way, I think (taking legal action is) better than not having the asset, and we'll find a way to make it work."
CanWest also seeks the right to elect a majority of the board of directors. MTL could not be reached for comment.
Asper's comments came after the company held its annual general meeting, where Frank McKenna made his final public remarks as chairman of the board. McKenna will continue to serve until he officially becomes Canada's ambassador to the U.S. in March. McKenna has been chairman for 15 months and a director for six years.
"This company's a lot stronger now," he told the meeting. "Looking back over the past year, our shares have gone from a 52-week low of $9 to dramatically higher levels."
As for reports CanWest, which publishes the National Post and Ottawa Citizen, is a few months from launching a new free commuter tabloid dubbed Dose in five Canadian cities —and that a publisher has been named — the company was mum yesterday.
"I'm working for CanWest and I'm working on a new business development," said Noah Godfrey, reported to be the publisher. "We're not confirming or denying anything." Godfrey is the son of Blue Jays CEO and CanWest director Paul Godfrey.
Asper was vague on the topic, though he repeated his statements earlier this month when asked what he'd do if Torstar Corp. and Metro International expanded their jointly owned commuter tabloid Metro beyond Toronto and Montreal and into other CanWest markets.
"One (way to respond) is to launch a competing product," he said. "... We would find a competitive response."
AZUR, ASPER FAMILY DISAGREE OVER "JERUSALEM POST" DEAL
Azur, Asper family disagree over "Jerusalem Post" deal
Eli Azur apparently wants to acquire full control of the newspaper, instead of owning equal shares with CanWest.
By Yael Gaoni
Globes
January 25, 2005
The sale of "The Jerusalem Post" by Hollinger International Inc. (NYSE:HLR) to Eli Azur and CanWest Global Communications Corp (NYSE:CWG; TSX:CGS), controlled by the Asper family of Canada, for $13.2 million, has run into trouble. Azur apparently wants to acquire full control of the English-language newspaper, rather than the two parties owning equal shares.
CanWest has a market cap of $5 billion. The buyers of "The Jerusalem Post" intend to sell the site the newspaper occupies in the Romema neighborhood of Jerusalem for $7 million, and move the paper's offices and printing works to new premises. The newspaper's 9.5-dunam (2.375-acre) site is considered desirable.
The sale of the newspaper was concluded two months ago, and Hollinger International notified the New York Stock Exchange to this effect. Sources close to Azur said today that the deal had not broken down, but that unexpected difficulties had arisen. Azur was unavailable for comment.