Working the Dead Beat

by Sandra Martin

  Thomson moved the crux of the family’s operations back across the Atlantic to North America and transformed the corporation from a print-based media conglomerate to a Web-based provider of information and services. In the process, he increased the company’s value exponentially, from about US$500 million in 1976 to roughly $29 billion by 2006, with a personal fortune of about $20 billion.

  During his tenure, Thomson sold off most of the company’s newspaper holdings, including the Times and the Sunday Times, prestigious but tempestuous and money-losing British newspapers, and acquired FP Publications, which included the Globe and Mail, a local flagship with a national reach that had always eluded his father. Thomson’s ownership of the Globe was diluted in a corporate merger in 2001 with CTV and Bell and their subsidiaries and partners. That changed nine years later, when the Thomson family bought back a majority interest in the Globe and Mail in September 2010. Observers could sense the friendly if ghostly presence of Ken Thomson on the day of the announcement as Thomson’s widow, Marilyn, his son David, the current chair of the global company, and his closest colleagues, Beattie and Tory, trooped into a crowded meeting room at the newspaper. “It was a dream,” David Thomson said later about the repurchase of the media company that had been intrinsic to three generations of his family.

  Thomson the Collector

  STORIES OF THOMSON’S frugality abound, from watching the parking meter run out before feeding it more coins to sorting through the bargain bins for socks and pushing a cart up and down the aisles checking the cost of produce in his local grocery store. Although he seemed unwilling to spend money on himself — his suits were serviceable rather than elegant — he was willing to dig deep to indulge his passion for Canadian and European art.

  In the same way that he refined his family’s business holdings, he pruned and buffed his collection of paintings by Cornelius Krieghoff, the Group of Seven, and David Milne, among other landscape artists, and his assemblage of European ceramics, ivory miniatures, and other artifacts. In building this art collection he created his personal legacy. “I like business,” he once said, “but I feel the same way about art that my father felt about business.”

  What propelled Thomson as a collector was a visceral reaction to something that pleased him aesthetically. He set about learning more about the artists he admired, studying their techniques and acquiring paintings that complemented each other. Collecting for him was more than a hobby; it was a process of discovery and self-education that he loved to share with friends such as John Band.

  “I wish I knew the first time I shook his hand,” Thomson said in an interview after Band’s death in 2005. “I think it was in the mid-fifties and it must have been about art.” For half a century the two men discussed upcoming auction sales, although their friendship meant they never bid against each other. “He was always around the corner from my house and up here,” Thomson said, tapping his forehead with his finger. “I never got along with anybody better.”

  These were also the years when Thomson made his first forays into collecting by scouring shops in Chinatown for carvings and curios. He moved on to genre paintings, buying his first Krieghoff in 1950, only realizing several years and many acquisitions later that he had developed a passion for the artist. Whenever Band was “adamant” about a picture, such as Steamship Quebec, painted by Cornelius Krieghoff in 1853, “I jolly well bought it. There wasn’t going to be any doubt about that,” Thomson admitted. In 1966, the same year his father bought the Times, he “made a decision to go strongly for Krieghoffs. I changed from a casual acquirer to an aggressive collector.”

  But it was not until he met Hermann Baer, an antique dealer in London, that Thomson became a serious as well as a passionate collector. A seventeenth-­century ivory and ebony crucifix in the window of Baer’s store drew him inside one day in 1959. “He showed me some things, beautiful things,” Thomson told the Globe in 2003, “but he told me I was not yet ready for them. He was showing them, he said, to the Ashmolean Museum in Oxford.”

  Baer helped Thomson refine his tastes, encouraging him to move boldly in pursuit of ivory and boxwood carvings, Baroque goblets, enamels, miniature portraits, and mementos mori. When Baer died in 1977, Thomson made some of his most significant acquisitions from the dealer’s estate. Two of the objects Thomson cradled in his hands back in 1959 — a boxwood Madonna and Child and a carved ivory depiction of Saint George slaying the dragon, are now in the Thomson collection. So is the ivory and ebony crucifix that Baer wanted the Ashmolean to have.

  In 2005 Thomson gave his friend Band a small J. E. H. MacDonald painting of his family’s island in Georgian Bay as a ninetieth-birthday gift. Knowing the value of the painting, Band refused to accept it, although he delighted in pointing out familiar landmarks. Finally he agreed to “borrow” the painting after attaching a note to the back saying it belonged to Thomson. When Band died shortly afterwards, the painting went back to Thomson, now layered with “priceless” sentimental value. Thomson hung it in his office and arranged for it to become part of his planned gift to the Art Gallery of Ontario.

  Others have given away a greater percentage of their fortunes, but the size of Thomson’s personal gift to the art gallery — more than three thousand works of art, valued in 2012 at approximately US$500 million, plus C$100 million in cash — is without precedent in Canadian history. He died two years before the acclaimed addition designed by Toronto-born architect Frank Gehry opened in 2008. The loss of such a dedicated and involved partner was devastating to AGO director Matthew Teitelbaum, who missed Thomson’s “incredible focus” and the “sparkle” of his conversation as the project progressed to completion. Once he had made the commitment to share his treasures, Thomson changed his approach to collecting, according to Teitelbaum. “I don’t want to acquire things that I just happen to like. I am going to acquire things that make the collection better,” he remembered Thomson saying.

  As in business, when Thomson increased expenditures to enhance well-developed initiatives, he bumped up his donations to the AGO. In 2002 he bought Peter Paul Rubens’s Massacre of the Innocents at a Sotheby’s auction in London for close to C$120 million. “I call it an electrifying painting,” he told the Globe at the time about the work. “How do you paint a painting like that — with such a gruesome subject — without it being totally off-putting? Its horror is obscured by its aesthetics. I find that extraordinary.” Today the painting is prominently displayed in the AGO, attracting visitors to the gallery and giving ordinary people, who could never afford a Rubens, an insight into the painting, the artist, and the collector.

  Early Days

  KENNETH ROY THOMSON was born on Isabella Street in Toronto on September 1, 1923, the only son and youngest of Roy and Edna (née Irvine) Thomson’s three children. He was descended from Archibald Thomson, a master carpenter, and David Thomson, a mason, two of three Scottish-born brothers who came with their families from Niagara to York, as Toronto was then called, in 1797. David Thomson built Upper Canada’s first parliament buildings on Front Street, as well as the stone powder magazine at Fort York — probably his only surviving building.

  For a man who ended up fabulously wealthy, Thomson’s childhood was far from luxurious. His father was an itinerant salesman who struggled to make enough money to pay the rent and feed his family of five. The Thomsons moved to Ottawa in 1925 and to North Bay three years later, always in search of more lucrative employment.

  When young Ken started school in North Bay, his father was away for days at a time, travelling by train to Cobalt, New Liskeard, Timmins, Cochrane, Sudbury, and Sault Ste. Marie to sell radios, auto parts, washing machines, and refrigerators. “He was always busy with various projects, travelling the North, selling, arranging things. He would often come home late at night,” Thomson told Saturday Night. “My mother would try to keep his dinner warm. We all knew he was a big worker, but it was difficult sometimes.”

  But li
fe wasn’t all loneliness and watching his father read the newspaper (“every inch of it”). He was, and remained, very close to his two older sisters. When he talked about his childhood in an interview with the Globe in 2003, he described a life of riding bicycles, exploring the woods, and fishing for pickerel in the summers and skating on the frozen lake in winter. He credited those halcyon memories for his later fascination with Cornelius Krieghoff and the Group of Seven.

  It was his mother who kindled his appreciation for music and painting. “Art almost bemused my father,” he said. “With music, the most serious thing he liked were Strauss waltzes. He liked people like Irving Berlin. But even then, if you were driving in the car, he was always fishing for news on the dial, even though it was the same news on every station. You could say he was obsessed with it.”

  Selling radio parts was tough in an area where reception was so dismal that listening was a frustration rather than a pleasure. Undaunted, Roy Thomson paid one dollar for a broadcasting licence, bought a fifty-watt transmitter on three months’ credit, and started CFCH, his first radio station, in North Bay in 1931. “I was eight years old and radios were still exciting things,” his son recalled. “All I really knew was that something big was going on in town and that Dad was at the middle of it all.” Soon his father had bought radio station CKGB in Timmins and followed up that purchase by moving into print, acquiring the Timmins Daily Press in 1934, in the depths of the Depression.

  The family moved back to Toronto in 1937, when Ken was fourteen. By then he was aware that his father was “really rolling.” He went to Upper Canada College, the elite private school, as a day boy. An average student and definitely not a jock, he was not part of the in-crowd. “I didn’t give it much of a chance,” he said later. “I was a little bit different from the other guys.” When he was sixteen, he worked as a disc jockey at CFCH for a summer.

  He graduated from UCC in 1942 and registered that fall at the University of Toronto, but dropped out in December to join the RCAF. He was nineteen when he was shipped overseas. After working as an instrument mechanic he was posted to London, where he rewrote news articles for an Air Force magazine called Wings Abroad.

  After the war, Thomson took a degree in economics and law at St. John’s College, Cambridge University. Back in Canada, he began learning his father’s business from the bottom up, working as a cub reporter for the Timmins Daily Press in 1947. A year later he went to Galt (now Cambridge, Ontario) as an advertising salesman for the Daily Reporter before serving as general manager of the newspaper from 1950 to 1953.

  Transatlantic Dynamics

  TWO YEARS AFTER Thomson’s mother died in 1952, his father packed up and moved to Scotland. By then he had begun making acquisitions that would include the Scotsman, Scottish Television (a franchise he would later equate with “a licence to print money”), the Times of London (a debt-ridden colossus that was rife with labour unrest), the Sunday Times, and an interest in North Sea oil and gas. When he joined the consortium along with J. Paul Getty and Armand Hammer in 1971, oil sold for less than a dollar (US) a barrel; at his death five years later, it was close to thirty dollars.

  While his father was buying and selling abroad, Ken Thomson stayed in Toronto as president and chairman of Thomson Newspapers, which became a public company in 1965. He had married Marilyn Lavis, a model whose picture he had seen in an Eaton’s catalogue in 1956. Together they raised two sons — David, born in 1957, and Peter, in 1965 — and a daughter, Lesley (now known as Taylor), born in 1959.

  By the time Roy Thomson died in 1976, the company was worth about $500 million and was publishing 110 daily newspapers in North America. “Ken immediately identified that the future was going to be about trust and stewardship and patience and it wasn’t about Ken being able to go off with the assets and fulfill his own dream of being an entrepreneur,” said Beattie. “These were his dad’s assets. ‘Everything we have today,’ Ken would say, ‘was because of my father.’”

  Immediately after his succession, Thomson wrote to shareholders to reassure them that their investment was safe because of the quality and dedication of the people running the myriad Thomson companies. “Successful businesses are sustained by people — men and women who contribute their time, their skill, their energy and their ideas to the development of a living, breathing, expanding enterprise. . . . Without them, no business amounts to more than a collection of buildings, machines and paper assets.”

  Within two years of his father’s death he formed the International Thomson Organization, with its headquarters in Toronto and two main operating subsidiaries in the United Kingdom and the United States. John Tory became deputy chairman. Now, instead of acquiring newspapers as he had done under Roy Thomson, Tory was seeking out specialized information companies.

  Tory, who had worked closely with Roy Thomson since the mid-1950s, made a seamless transition to working with his former boss’s son. The relationship was different but it was equally close. They were more of an age and they established a great rapport, which David Thomson compared to the prolific scoring duo of Wayne Gretzky and Jari Kurri with the Edmonton Oilers in the 1980s. “They knew where each other was, where the puck was, and where the opposition would be,” he said. “My father was able to do pretty much what he was consummate at, which was leading people; but he needed John’s support to précis and present ideas and possibilities.”

  The Newspaper Wars

  LABOUR DISPUTES AND wildcat strikes at the Times newspapers in London provoked Thomson into suspending publication of both the Times and the Sunday Times in December 1978. The lockout lasted nearly a year and cost the company nearly £70 million. Later admitting that the ploy was a “disaster,” Thomson said, “You don’t go into something unless you can see how it’s going to come out. We did, when we couldn’t. Our problem was that we paid the journalists throughout and so nobody believed us when we said we would close the papers for good . . . There was no realism about our handling of the dispute.”

  In October 1980 the company put the newspapers up for sale and Australian media magnate Rupert Murdoch made a low but successful offer of £14 million on February 13, 1981. Thomson insisted that he never regretted selling the Times. “We had to get on with our own lives, and we did, and rebuilt the company. I’m sure if my father came back today, he would understand.”

  The bruising from the sale of the Times was soothed by the acquisition of FP Publications in Canada in 1980, with its flagship newspaper the Globe and Mail as well as the Winnipeg Free Press and the Ottawa Journal, among other titles, for C$165 million. The purchase brought the company’s share of English-language daily newspaper circulation in Canada to about 26 percent, with daily sales topping a million.

  The Thomsons may have been happy with their new newspapers, but many Canadians were afraid that the country had been split between two rival newspaper chains, owned by the Thomson and the Southam families. This fear became even more acute on August 27, 1980, when Thomson Newspapers closed the Ottawa Journal and the Southam family simultaneously shut down the Winnipeg Tribune, leaving both of those cities with only one daily newspaper.

  Radio and television had been eroding print’s share of the marketplace for decades. In the early part of the twentieth century, at least five hundred towns in North America had at least two rival newspapers. By 1978 only thirty-five towns could make that boast. Pierre Trudeau’s Liberal government appointed the Royal Commission on Newspapers in 1980, under the chairmanship of Tom Kent, a British-born journalist, former editor of the Winnipeg Free Press, and policy adviser to former prime minister Lester Pearson. It recommended that chain ownership in the future should be limited to twenty percent of national circulation, but a bill to that effect died on the order paper in 1983.

  Nevertheless, both Thomson Newspapers and Southam were charged with two counts of criminal conspiracy to reduce competition and with criminal merger. John Tory and Southam head Gordon Fisher we
re named as co-conspirators under the federal Combines Investigation Act. They were eventually acquitted when Mr. Justice William Anderson accepted defence arguments that the closings of the Ottawa Journal and the Winnipeg Tribune were the result of independent decisions based on the state of the marketplace, and not the consequence of collusion.

  Thomson never again purchased a major Canadian newspaper. Instead he looked south of the border for new print acquisitions, eventually becoming the owner of more dailies in the United States than any other corporate entity. By 1989 Thomson Newspapers had annual revenues in excess of US$1 billion. To make its financial resources available to the wider Thomson group of companies, Thomson Newspapers was merged with its sister company, the International Thomson Organization Ltd., to form the Thomson Corporation, with Thomson continuing as chairman of the new company and Tory as deputy chairman.

  The 1990s were a decade of refocusing and restructuring the corporation into strategic marketing groups. The U.K. newspapers were sold, and the move into the professional and reference fields — which had begun in 1987 with the purchase of legal publishers in the U.K., Canada, and Australia — continued with the acquisition of West Publishing in 1996, a company best known for its Westlaw online research services and databases.

  This trend — to be global in scope, electronic in nature, and aimed primarily at the business and professional marketplace — accelerated after Richard Harrington became president and CEO of the Thomson Corporation in 1997. By the turn of the century Thomson Travel had been sold, and so had all of the community newspapers that had been the original source of the company’s wealth.

  Canada was a battlefield in the late 1990s in a huge and acrimonious national newspaper war between the Globe and Mail and the National Post, which had been launched in October 1998 by Conrad Black. By 2001, Black, faced with mounting legal and financial woes, had sold the Post to the Winnipeg-based Asper family. The Globe had triumphed in the war, in the view of rival John Honderich, then publisher of the Toronto Star, because “Conrad Black underestimated Ken Thomson’s resolve.” He once suggested this to Thomson over a drink at the SkyDome in Toronto, and Thomson’s face lit up with a gentle smile. “I rather thought so myself,” said the magnate, in a rare moment of self-satisfaction.