Hollinger Inc.

Hollinger Inc.

January 10, 2005 12:16 ET

Hollinger Inc.: Special Dividend Status


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: HOLLINGER INC.

TSX SYMBOL: HLG.C
TSX SYMBOL: HLG.PR.B

JANUARY 10, 2005 - 12:16 ET

Hollinger Inc.: Special Dividend Status

TORONTO, ONTARIO--(CCNMatthews - Jan. 10, 2005) - Hollinger Inc.
("Hollinger") (TSX:HLG.C)(TSX:HLG.PR.B) today corrected a statement it
made on December 17, 2004. Following the announcement by Hollinger
International Inc. on December 16, 2004 of the declaration by its Board
of Directors of a special dividend in the amount of US$2.50 per share on
its Class A Common Stock and its Class B Common Stock, Hollinger had
stated that substantially all of its share of the special dividend was
required to be lodged as collateral in support of the US$93 million
principal amount of Hollinger's outstanding Senior Secured Notes.

This statement was based upon preliminary legal advice. Upon further
analysis, and following the receipt of further particulars in respect of
the Hollinger International special dividend and the views of the
trustee and collateral agent for the Notes, Hollinger has determined
that none of the special dividend is required to be lodged as collateral
security for the Notes at this time. The Notes already are adequately
collateralized under the existing loan documentation.

The Hollinger International special dividend is payable on January 18,
2005. As previously announced, Hollinger will receive an aggregate of
US$39,432,307.50 in respect of the special dividend. Hollinger has not
yet made any determination as to the use of the proceeds of the special
dividend, which determination will be made by its Board of Directors.

In announcing the declaration of the special dividend, aggregating
US$227 million, Hollinger International stated that it would be
distributing a total of US$500 million to its shareholders, including
the special dividend. According to management of Hollinger
International, the earnings from which the special dividend will be paid
derive from the proceeds of the sale of The Telegraph Group. The
proposal is to distribute the balance of these proceeds in the form of a
tender offer for shares of Common Stock of Hollinger International after
it publishes its delinquent financial statements and other reports, or
as a further special dividend. Although the second distribution is
expected to be effected in the first quarter of 2005, Hollinger
International has given no assurances that it would distribute further
cash to shareholders in either form.

Hollinger's principal asset is its interest in Hollinger International
Inc. which is a newspaper publisher the assets of which include the
Chicago Sun-Times, a large number of community newspapers in the Chicago
area, a portfolio of news media investments and a variety of other
assets.

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