Torstar Corporation Announces 17.5% Price Increase Under Nordstar Acquisition To $0.74 Per Share

Torstar Corporation (“Torstar”) (TSX:TS.B) today announced that it has entered into an amendment (the “Amendment”) to the arrangement agreement dated May 26, 2020 (the “NordStar Agreement”) between Torstar and NordStar Capital LP (“NordStar”), pursuant to which NordStar has agreed to acquire all of the issued and outstanding Class A shares and Class B non-voting shares of Torstar (the “Shares”) by way of a statutory plan of arrangement at an increased price of $0.74 per Share. The amended purchase price constitutes an increase of 17.5% from the $0.63 per Share payable under the original NordStar Agreement.

The amendment to the NordStar Agreement results from discussions with NordStar following Torstar’s receipt of an unsolicited offer from a private investor group, pursuant to which such group proposed to acquire all of the issued and outstanding Shares for a combination of $0.72 per Share in cash and the issuance of one non-transferable contingent value right per Share, with payments (if any) on such right being based on proceeds of dispositions of, and distributions from, select Torstar non-core assets in certain circumstances following issuance.

As previously disclosed, the private investor group offer was conditional on, among other things, the entering into of voting support agreements by the trustees of the Torstar Voting Trust and Hamblin Watsa Investment Counsel Ltd. (“HWIC”), a wholly-owned subsidiary of Fairfax Financial Holdings Limited (“Fairfax Financial”). The trustees of the Torstar Voting Trust and HWIC have advised the Torstar board of directors (the “Board”) of their intent not to support such unsolicited offer and, conditional upon execution of the Amendment, to enter into new voting support agreements with NordStar (as described below). The Board determined in good faith, after consultation with its financial and outside legal advisors, that (1) the unsolicited offer from the private investor group would not be able to constitute a “Superior Proposal” under the NordStar Agreement, as amended by the Amendment, as such offer would not be reasonably capable of being completed without undue delay relative to the NordStar transaction, and
(2) the NordStar Agreement, as amended by the Amendment, is in the best interest of the company and to recommend that Torstar shareholders vote in favour of the NordStar transaction, as amended, at the special meeting of Torstar shareholders scheduled for July 21, 2020 (the “Special Meeting”).

“We appreciate the support that the Torstar Voting Trust, the Board of Directors and HWIC have placed in us,” said Jordan Bitove, CEO of NordStar. “The Toronto Star is a very important pillar of this country, and we intend to do the best we can to ensure this Canadian institution thrives for another hundred years.”
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