I know I’m wading into murky territory here by directly talking about the parent company of my employer, Canwest Global Communications, but after reading an article written by The Georgia Straight, a Vancouver alt-weekly, on its recent stock performance (Why have Canwest shares risen almost 100 percent in two weeks?), I feel obligated to chime in on how incredibly wrong it is.

In the article, Charlie Smith theorizes that Canwest’s surge on the TSE (from about 35 cents to around 70 cents) is due to a number of scenarios, none of while are actually true. The theories range from Canwest executives lobbying the government for an industry-wide bailout ala the auto industry to Rupert Murdoch’s News Corp. taking a stake in the company to hedge funders playing around with the company’s stock.  If Mr. Smith had done his homework, he’d at the very least strike two of these theories off the record.

First of all, a simply Google search could find that no lobbying was done on Canwest’s behalf to pursue a government bailout to help bolster the company. A recent search on the Canadian government’s lobbying registry finds that Canwest hasn’t lobbyied the government since last August and it was on income tax related issues (along with dozens of other media companies).

Furthermore, directly taking taxpayer money to save Canadian journalism would be something that would raise quite a number of red flags. As this Reuters article points out:

Relying on government help raises ethical questions for the press, whose traditional role has been to operate free from government influence as it tries to hold politicians accountable to the people who elected them. Even some publishers desperate for help are wary of this route.

Frankly, Canadian media companies are nowhere near a position to ask the government for help. Although times may be tough, everyone is still churning out money and Canwest still has quite a bit of time until its debt covenants mature for it to make a move as drastic as that.

Which leads to the next scenario Mr. Smith points out: rumours that Mr. Fox News himself, Rupert Murdoch, is responsible for the action on the market, something he has quite literally pulled out of thin air from a previous post. While it certainly is fair game for Mr. Murdoch to snap up some publishing entities in Canada, common sense tells me it’s highly doubtful he would choose to do such a thing.

Aside from skirting CRTC regulation, this is quite possibly the worst time in the world to be snapping up companies, let alone media conglomerates. It will certainly be a long time until banks are confident enough to issue enough credit for any M&A’s to happen. At the same token, News Corp. is not in sturdy financial shape either and would likely take a pass (for now) until the advertising market picks back up for it to start even considering acquiring low-hanging fruit.

What likely caused the stock to grow is simple – the company’s stock fell because its Australian broadcast holdings reported less-than-expected results. How did I find that out? Easy. I used Google and matched the dates up to the stock chart. At the same time, Canwest’s stock is now close to surpassing past the $1-level, a slow yet steady climb back to where it likely should be valued at. Most market watchers would agree that 35 cents would be far too low for any company with a book value of about $8 per share, even with its debt load.

Along with other Vancouver-based local media outlets, The Georgia Straight have had a lengthy history of poking at Canwest, mainly because the companies control a near-dominant stake in the area’s media coverage.  While I will never be one to discourage any sort of criticism on corporate entities, at the very least I’d hope that same criticism is done in a responsible manner. In their recent outlook at the Canwest empire, The Georgia Straight has failed to do just that.