Postmedia purchase of Quebecor's Sun Media OK'd by Competition Bureau

Canada's competition watchdog has given the all-clear to Postmedia's purchase of 175 Sun Media newspapers for $316 million.

Approval was final hurdle in $316M, 175-newspaper takeover by publisher of National Post

Canada's Competition Bureau won't block Postmedia's takeover of Sun Media and its 175 newspapers across the country. (Adrian Wyld/Canadian Press)

Canada's competition watchdog has given the all-clear to Postmedia's purchase of 175 Sun Media newspapers for $316 million.

In a decision posted on the Competition Bureau's website Wednesday morning, the regulator says that after a five-month investigation that began when Postmedia announced the deal last October, it has no opposition to the takeover, because "the proposed transaction is unlikely to substantially lessen or prevent competition."

The move was the final hurdle in the takeover becoming official, which means the deal can now close in the next few weeks.

The bureau cited a lack of a close rivalry between Postmedia's broadsheet newspapers and Sun Media's tabloid newspapers in its decision.

The regulator also said the media company will want to keep readers and maintain editorial quality to attract advertisers to its newspapers, which face competition from free newspapers and digital alternatives.

"The bureau also took into consideration the dynamic nature of media markets and the challenges faced by traditional media in adapting to an increasingly digital world," the competition watchdog said.

"However, its review revealed that both readers and advertisers continue to value newspaper content and advertising in spite of the proliferation of digital alternatives."

Postmedia publishes the National Post and city newspapers such as the Vancouver Sun, the Calgary Herald, the Ottawa Citizen and the Montreal Gazette.

One media watcher said the deal getting the thumbs-up from the regulator was no surprise.

"The bureau was looking at advertising and those markets," Carleton professor of communications Chris Waddell said.

"It doesn't really have a role in content, and whether — if two papers are owned by the same company — does that change the views that get covered. That's not part of the bureau's job."

"The likelihood they would turn this down is pretty slim," he said, adding that he suspects the chain will now sell off some papers in markets where it now owns more than one, or maybe shut some down altogether.