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Revised Pact Reached to End Hollinger Control of Sun-Times Media Group

Magazine article Editor & Publisher

Revised Pact Reached to End Hollinger Control of Sun-Times Media Group

Article excerpt

In a revised agreement that would end control of the Sun-Times Media Group (STMG) by an insolvent Toronto holding company, Hollinger Inc. has agreed to turn over its stake in the Chicago Sun-Times publisher to one of its major creditors, Davidson Kemper Management LLC.

The agreement would end the super-voting class of stock that allowed Hollinger Inc. to control a 70% voting stake in STMG with just a 19.7% equity stake.

The agreement replaces a settlement announced in April, which would also have converted super-voting stock into stock with just one vote per share.

For its part, Davidson Kempner (DK), which holds about 42% of Hollinger Inc.'s debt DK, agreed not to force the holding company into bankruptcy. DK will also be paid an upfront fee of $1.5 million, and legal fees of up to $3 million.

The six directors Hollinger forced on the board in a corporate coup a year ago agreed to resign once the agreement is given approval by the Canadian court that is overseeing Hollinger Inc. …

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