Friday 5 May 2017

The Handover

Readers of this blog may recall that in the summer of 2015 I wrote a few posts about something I called a CanLit Mystery.  I had begun to poke into how Canada's longest-lived and best independent publisher, McClelland &Stewart Ltd. (which brought us works by Alice Munro, Margaret Atwood, Margaret Laurence, Michael Ondaatje, Peter C. Newman, Mordecai Richler, Leonard Cohen, and other leading lights of CanLit), ended up in the hands of a foreign entity, Bertelsmann. The largest publisher in the world, Bertelsmann now owns what remains of M&S in spite of Canadian law and policy forbidding such transactions.(The law says they can only be done in specific circumstances with the approval of the Minister of Canadian Heritage, yet year after year, deal after deal, the law has been interpreted by bureaucrats with all the creative flair of Hollywood accountants.) I wanted to know how Avie Bennett had managed to get the company off his hands while remaining the chairman of its board for 11 years. I knew--everybody in the book business knew--that the first part of the deal involved Bennett giving away 75% of the shares of M&S to the University of Toronto in 2000. The U of T's press release at the time implied that it would act as the Canadian steward of M&S for the future benefit of all Canadians, thanks to Bennett's generosity. But the other 25% was sold to Random House of Canada, a Bertelsmann subsidiary. Random House also entered into an administrative and financial services contract with M&S to run the company. Only a few seemed to find this odd, though one had to ask: why would Random House, M&S's most formidable competitor, work hard to keep M&S in tip-top form? When questions were raised at the time, especially about the legalities, the word was put out that Ottawa had given its blessing in advance.

And that was all that emerged in public about this curious transaction for the next 11.5 years, until Random House announced it had acquired all of the U of T's shares, giving it 100% ownership of CanLit's best backlist,something forty years of policy and many millions in grants had aimed at preventing.

Nobody managed to find out how this happened, or why.

A few years later I found myself with some spare time and some real concern about the state of Canadian publishing. What is spare time good for if not to poke into things that seem odd? And everything about the M&S deal seemed odd.

So I made some calls, wrote some emails. I soon learned that the Canadian Heritage Minister in 2000, Sheila Copps, did not think that this matter had come before her. And then I found out that U of T had transferred its M&S shares to Random House for the sum of $1--suggesting that this country's literary inheritance had somehow been reduced in value to zero.

Only in Canada, you say?

So I did some interviews. After learning from Avie Bennett that control of M&S had passed to Random House long before the actual shares did, and discovering that M&S's former President, Doug Gibson, wasn't too sure whether the millions in grants M&S had won as a Canadian owned -and- controlled company were appropriate, I wrote a few posts.

But then some fascinating documents landed in my lap. I couldn't write about them until I'd done a whole lot more digging.

Last week, I took down those old CanLit posts, right after Biblioasis, a highly regarded Canadian independent publisher, sent my new book on this subject to press. It's called The Handover. It's not just an inside baseball book about Canadian publishing: it lays out the story of how our nationalist cultural policy became the third rail of Canadian politics-- not touchable in public, but gotten around over and over again behind closed doors. Pursuing the M&S story opened up a much larger one about how power really works in this country. The Handover, in other words, is a sharp astringent to the sweet stories about to pour forth for Canada's 150th birthday party.

If you're a globalist, you're going to want to read it. If you're a nationalist, you're going to want to read it. If you just want to know how we really do things as opposed to how we say we do things, you're going to want to read it.

The Handover should be in bookstores shortly, but if, as I suspect, our dominant book store chain is not too keen to stock it, try an independent. If push comes to shove, order it on


"Anyone who cares about Canadian culture needs to read this bombshell of a book. Elaine Dewar takes us on her journey as she uncovers the sad truth that Canada's preeminent book publisher was handed on a silver platter to a transnational conglomerate while taxpayers footed the bill. The Handover puts an end to our assumption that laws promoting Canadian culture are any longer enforced." - Maude Barlow, author of Blue Gold

"The Handover reads like the best mystery novels. It is the single most important book about Canadian publishing, authors, culture, and sovereignty published in 50 years. It is an exceptionally well-researched and documented trail of how the wealthy, powerful, and some government officials used high-priced lawyers, accountants and institutions to bypass the intent of Canadian government policy and ideals...Essential reading for everyone who cares about our country." - Jack Stoddart, O.C.

"Intrepid reporter Elaine Dewar writes with clarity and passion, and in her hands the story barrels forward, peeling away the layers of the M&S debacle. Through interviews with the major players and by diligent research, she uncovers the startling truth of how The Canadian Publisher fell into foreign hands." - Jack David, Co-publisher & Founder of ECW Press


  1. Hi Elaine: Very happy to see that you would go to the trouble to document this debacle.

    Back in 2012 I covered the story, including a tally of all the government publishing grants M&S received once effective control had passed to Random House.

  2. Thank you for your comments, Thad. I think your number is low, but that's not your fault, it's that Canadian Heritage is not helpful when it comes to listing those grants, and then you need to go to the Ontario Book Fund, the Ontario Council for the Arts, and of course the Ontario tax credit which only publishes the total tax credits authorized and the number of applications, but not how much each company actually receives.

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