The demise of Canwest Global Communications Corp. will go down in history as one of the most spectacular falls from grace in Canadian business history.
At the beginning of the 21st century, Canwest was a media giant on the rise, with its stock trading at almost $30. But a crippling debt load combined with a crumbling advertising market turned Canwest shares into penny stock and brought the company to its knees just a few years later.
When a corporation of this magnitude goes belly up in a city like Toronto, it’s big news. But in Winnipeg, it’s absolutely gigantic. That’s because no other company in the country meant as much to its home base as Canwest. The same goes for its majority owners, the Asper family — there’s a good reason the city’s moniker used to be “Asperville.”
The Canwest head office used to employ several hundred people. Whenever there was a chance for a division, or even a person, to perform their duties from the Winnipeg office, the Aspers — first Izzy, and then his children, Leonard, David and Gail — made it happen. The family was the father the city never had.
But with Canwest’s newspaper and television assets having been picked up by Shaw Communications Inc. and Postmedia Network Inc. in mid-year fire sales, Winnipeg is left to pick up the pieces and ice down its bruised psyche.
The disappearance of Canwest’s head office in the Canwest Place office tower — Winnipeg’s tallest skyscraper will certainly have a new name in the not-too-distant future, as its owners, Creswin Properties, which is controlled by the Aspers, will want to move on from a defunct brand — isn’t the only bad news to hit Winnipeg’s corporate community over the past couple of years.
More than a decade after the Big Five banks relocated their Prairie head offices to Calgary, Winnipeg has seen a number of high-profile firms, pillars of the community, pull up stakes and move out.
Sure, some people are remaining here; but the decision-makers have gone elsewhere. First, there was agricultural giant Agricore United Holdings Inc., which moved several hundred employees to Regina after it merged with the Saskatchewan Wheat Pool in 2007. It’s now known as Viterra Inc.
Then there was StandardAero Ltd., the largest aerospace player in Manitoba, which saw its head-office operations relocated to Arizona after it was bought by Dubai Aerospace Enterprise Holdings (DAE) for more than $1 billion two years ago. Just a couple of months later, HudBay Minerals Inc. announced it was shifting its head office from Winnipeg to Toronto after a merger with Sky Resources Inc.
The result has been the loss of almost 1,000 jobs from Winnipeg and an unmistakable blow to the city’s confidence and reputation.
If all of that wasn’t bad enough, following the retirement of Ray McFeetors as the president and CEO of Great-West Lifeco Inc. in the spring of 2009, the new leader of Manitoba’s biggest company doesn’t even call Winnipeg home. McFeetors’ successor, Allen Loney, lives in Toronto.
While that might not mean much from a corporate point of view, it’s a far bigger deal for Winnipeg. When CEOs aren’t in town, they’re not around to run the local United Way campaign, wave the corporate flag at Canadian Club luncheons or serve as an example to the next generation of leaders — not only at their own companies but in the entire Winnipeg business community.
It’s going to be difficult, but it’s clear that Winnipeg needs to find new ways to stop the corporate bleeding. IE
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