(Bloomberg) -- The Desmarais family is parting ways with its newspaper after five decades.
Power Corp. of Canada, the Montreal-based holding company, is cutting ties with French-language La Presse, the newspaper said Tuesday in a statement. La Presse will adopt a not-for-profit structure -- if the conversion is approved by Quebec’s provincial legislature.
Power Corp. will contribute C$50 million ($38.6 million) to the new entity, which will seek funds from new sources at a time when online giants such as Facebook Inc. and Alphabet Inc.’s Google get the bulk of advertising money.
“The new structure is designed to be a modern approach adapted to the realities of today’s written media,” La Presse said. The Power Corp. contribution “will help La Presse focus on its strategic plan in an orderly manner and to bring together the necessary conditions to expand its support base, from the federal government, to major donors, foundations, advertisers and the general public.”
The newspaper, which is offered for free on tablets and went all digital in late 2017, was bought by the late Paul Desmarais Sr. in 1967. Power Corp., which runs one of the country’s biggest insurers and mutual-fund companies and is publicly traded, has never shared details of La Presse’s financial health.
“The decision to modify the ownership structure of La Presse was not an easy one,” Power Corp. General Counsel and Secretary Stephane Lemay said by email. “We have the firm conviction that we’re making the right decision for the future of La Presse, an institution that plays a fundamental role in the vigor of Quebec’s democracy.”
La Presse was founded 130 years ago and employs 585 people. In the statement, it called on the government to financially support print media “through philanthropic models, as well as through direct assistance.”
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