Vaughan printing plant sells for $54M

Torstar Corp. announced Monday it has reached an agreement to sell the property and buildings in Vaughan, Ont. that housed its former printing plant to an unidentified buyer for $54.25 million.
The newspaper publisher stopped using the presses at the plant, north of Toronto, in July and shifted the work to Transcontinental Inc.
In a research note, RBC analyst Drew McReynolds said the sale price falls at the high end of the bank’s estimated range of $40 million to $50 million, and that gross proceeds from the sale will amount to 67 cents per share.
McReynolds said RBC expects the newspaper company to use the proceeds from the sale, which Torstar says it expects to complete later in the year, to fund business investments and its pension liabilities.
Torstar revealed in its latest Management’s Discussion and Analysis form, released as part of its second quarter financials, that it expects to have enough cash from operations and sales of assets, such as the Vaughan plant, to cover its cash requirements to the end of 2017.
However, the company also wrote in its analysis that the outcome of its next actuarial evaluation could be that its cash requirements increase significantly, in particular with respect to its defined-benefit pension plan. Torstar had $158 million in employee benefits liabilities as of June 30, up from $87 million on Dec. 31, 2015.
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