SaltWire files for creditor protection with $94m debt: The end of Atlantic Canada’s newspaper giant?

The news media in Canada is in crisis. Policy responses to date are failing to solve for the information that citizens need to make informed decisions about important issues and debates. The Future of News series brings together leading practitioners, scholars, and thinkers to imagine new business models, policy responses, and journalistic content that can support a dynamic future for news in Canada.

In 2017, the Dennis-Lever family, owners of Halifax’s historic Chronicle Herald, founded in 1874, purchased 27 newspapers across Atlantic Canada and placed them under the banner of the newly formed “SaltWire Network.” The acquisitions, which included St. John’s’ Telegram and Charlottetown’s Guardian, were purchased for an estimated $27 to $34 million dollars. They effectively became part of the largest private media company in the region. At the time, SaltWire CEO Mark Lever was criticized for making such a large commitment to such a precarious industry, and for spending millions while telling striking Chronicle Herald employees that revenues had declined.   

Seven years later, that criticism has proved prescient. 

After years of closing and merging papers, SaltWire announced last week it has filed for creditor protection. It blamed “unprecedented challenges” in Canadian media for its staggering $94 million debt. Its creditor, Fiera Private Debt, says SaltWire has been “demonstrably mismanaged,” and that paycheques and pensions have been withheld from employees. 

SaltWire did not respond to questions from The Hub regarding its finances, but in a press release, it said creditor protection was “a proactive step towards restructuring our finances and operations to build a more resilient and sustainable future.” It added that it remains “fully committed to delivering high-quality journalism.”

“This is huge,” says Brian Daly, an assistant professor of Journalism at University of King’s College in Halifax. “We’re talking about a population in Nova Scotia that just hit one million, so anything that happens in the news landscape is going to be amplified beyond what it would be in the larger centres.”

But while Daly acknowledges that modern news organisations face uphill battles, he questions SaltWire’s suggestion that their struggles were “unprecedented.” 

“When I hear language like that, I’m not buying it,” Daly says. “What new challenges have come up that we didn’t already know about? The challenges the newspaper industry faces are not new. We have old ideas, and people who don’t want to change.” 

Daly adds “The same problems we saw 20 years ago, they’re still endemic and could be encapsulated in the specifics of the SaltWire story.” “I have flashbacks when I hear about pension mismanagement. We’re making the same mistakes in 2024.”

As Daly explains, local news consumption has declined since the onset of the digital age and social media continues to eat into revenue opportunities. Today, if SaltWire cannot find a new strategy, many of Atlantic Canada’s most trusted and well-known news sources could be wiped out simultaneously.  

Precedented challenges 

In a flattering 2013 InBusiness profile, written after Sarah Dennis and Mark Lever took over the Chronicle Herald after longtime publisher Graham W. Dennis’ death, the pair discussed having a less romantic view of the newspaper industry. “It’s a business, and you have to run it like a business,” Dennis said. 

But business did not go well. As independent alternatives like The Halifax Examiner and allNovaScotia adapted to the digital age with hard paywalls and focused editorial visions, The Chronicle Herald went through layoffs in 2014, a 2015 battle with its printing press union, and a lockout of its newsroom staff that stretched from January 2016 through August 2017. In 2019, The Chronicle Herald sued TC Transcontinental, accusing the Montreal-based company of misrepresenting the finances of the papers SaltWire had purchased from them. 

The suit’s outcome is still pending, but by the time the lockout was resolved, The Chronicle Herald had faced accusations of strikebreaking and union busting and made national headlines when inexperienced scab employees posted—then retracted—a sensational, unverified story about violent Syrian refugees. The union ultimately agreed to a longer work week, pay cuts, and layoffs. Jobs at other SaltWire papers were also cut. SaltWire was far from the only news organisation to undergo cuts but such incidents did not engender confidence that it was the right company to lead its acquisitions. 

“The allegations from the creditors are very familiar,” Daly says. “The problems being described with SaltWire have been made by other media companies that acquired properties they didn’t believe in, or that weren’t smart acquisitions. There are other ways, and there are certainly news organisations doing it the right way.” 

Journalist and columnist Paul Schneidereit, who worked at the Chronicle Herald between 1983 and 2023 before taking a voluntary buyout, was there for SaltWire’s formation and the broader challenges the paper faced. 

“There were some changes the company wanted that the union wasn’t keen on,” says Schneidereit. “When we went on strike, we had 60-some newsroom members. I believe only 29 of us went back. The local production desk was moved elsewhere. Those jobs were gone.” 

Schneidereit, who serves as the Canadian Association of Journalists’ treasurer, notes that SaltWire consolidation did have its advantages. 

“We were able to reach out to colleagues at other papers and combine forces on things,” he says. “The Herald was seen as a flagship of the new network. We had the biggest newsroom, even though it was a shadow of what it had been once.” 

In SaltWire’s defence, the struggles of local journalism preceded its existence by decades. Schneidereit notes the Chronicle Herald’s newsroom included more than 100 journalists in the ‘80s. Today all of SaltWire’s papers employ 100 journalists.

“It’s been a horror show for the past 20 years, across Canada and beyond Canada,” Schneidereit says. “Papers closing left, right, and centre, journalists losing their jobs. And of course Facebook and Google, until recently, refusing to pay anything for all the news they scalp, that hasn’t helped.” 

SaltWire could clearly not adapt to all these challenges. As they try to survive, many are asking what lessons can be learned from their competitors.

Paywalls and emerging non-profits 

The fate of SaltWire’s portfolio remains undetermined. A worst-case scenario would see Atlantic Canada banished to a news desert, one where broadcast news and new independent publications simply cannot fill the hole that Saltwire potentially leaves behind. For now, the Nova Scotia Supreme Court has granted SaltWire temporary credit protection. It’s conceivable that its flagship brands will be sold or restructured, but it’s difficult to imagine employees emerging unscathed. 

“This latest news hit hard,” says Professor Daly. “The Chronicle Herald is a heritage property. There’s symbolic significance and a real-life impact on people.”

Daly adds that while there is still an older audience willing to pay for this sort of news, SaltWire’s soft paywall and ad-focused business model remains inherently broken. 

“We might see the large properties stay open, there’s brand recognition, and there are subscribers. We shouldn’t dismiss anyone over 55 as an unimportant market, they have the most money and are disproportionately subscribing to newspapers,” he explains. “However, there are endemic industry issues, and if they’re not solved we might be right back here having this conversation again in five years. There are so many options for companies to thrive in the modern ecosystem, but it’s not going to be by selling ads.” 

Despite SaltWire’s collapse, Daly is actually optimistic about journalism in Atlantic Canada. allNovaScotia, which offers paying subscribers straightforward coverage of politics and business, expanded to Newfoundland and Labrador, New Brunswick, Saskatchewan, and Alberta between 2016 and 2024. That’s impressive growth in a struggling industry, and it’s come from picking up the slack left by failing legacy newspapers. 

“They’re entirely behind a paywall,” Daly says. “They only focus on politics and business. They’re not terribly partisan. That model is working. If you find, hypothetically, 35,000 people willing to pay, that can sustain a news organisation. I’m very surprised to see that mainstream news organisations are afraid to have a hard paywall.” 

Daly also highlighted La Presse’s 2018 shift to nonprofit status. He notes that Montreal’s newspaper of record continues to enjoy a strong subscriber base and impressive financial reports, making it one of Canada’s largest newsrooms. La Presse discontinued its physical paper on New Year’s Eve 2017, and it benefits from a homogenous French-speaking audience, but it still has lessons to teach papers like the Chronicle Herald.  

“Their annual report is some of the best news I’ve seen in journalism,” Daly says. “The non-profit model has been more successful than the profit model. They still sell ads, they try to make as much money as they can, but the profits get reinvested back into the newsroom instead of buying bigger Mercedes-Benzes. It helps that La Presse is a big brand, but there’s a precedent for adopting a model like that and finding success.” 

That’s not to dismiss the for-profit model entirely. Daly spoke glowingly about working at CTV at a time when “they believed strongly in that local news model” and “heavily promoted [that] work.”

But that journalism profit is increasingly difficult to find, and owners are often unable or unwilling to hunt for it. Tightening profit margins can also produce strategic tensions. There is little financial gain in covering, for example, a politician’s press conference, but Canadians have the right to hear about it. 

“Some journalists spend weeks or months on an investigation, I don’t believe that should be given away [for free to readers],” Daly says. “But some journalism covers events we should have the right to know about. That’s different, let that stuff go out for free. So I think there needs to be a mixed model there.” 

The nonprofit model could be the path forward for publications like the Chronicle Herald. As much as modern organisations like allNovaScotia can help fill in the gaps, legacy publications hold an essential place in the media ecosystem. That position is now threatened. 

The future and the past 

The Telegram, which has served St. John’s, Newfoundland since 1879, was recently shortlisted for a National Newspaper Award for its 2023 exposé of the city jail’s living conditions. Schneidereit worked on the Chronicle Herald’s 2018 investigation of a Nova Scotia health services contract with a biased bidding process, potentially costing the province millions. These are the types of stories that local papers, despite cuts and alternatives, remain equipped to cover and that Canadians, despite a shrinking willingness to spend money on news, deserve to know about, insists Schneidereit.  

“The Herald, like a lot of papers, has archives going back well over a century. We used to cover every school board and town council,” Schneidereit says. “I’m not blaming the Herald for cutting back, because everyone’s had to cut back. But you don’t realise what you’re losing if it’s happening bit by bit. You don’t know what you don’t know. And when people don’t know what’s going on, there’s opportunity to get away with things people would not be happy about if they knew about them.” 

Schneidereit isn’t all negative. He says that “really fine journalism is being done by people working in online-only operations.” But he also notes that newspapers offer journalists legal protection, the lack of which can make “digging into a juicy story with sharp edges” unpalatable for an independent operator. 

Despite those risks, Daly has seen entrepreneurial students go out and cobble together salaries from podcasting, crowdfunding, and journalism grants. Stories like SaltWire’s collapse may contribute to an atmosphere of malaise, but the industry continues to soldier on in new forms. 

Still, the Chronicle Herald has been part of the Halifax landscape since 1874, only seven years after Canada was born. To lose it would be to lose a slice of history to what he describes as misguided mismanagement. 

“Local and regional pride, that intense pride in your community, is so much stronger here than in other places I’ve lived,” Daly says. “The newspaper is part of that. The newspaper has been part and parcel of Atlantic history. If a big paper is lost, we’ve lost quite a bit.”

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