Troubled newspaper creates 200% windfall with digital arm's IPO

The buyers of the Toronto Star newspaper have tripled their money on the investment in less than a year after completing an initial public offering of a little-known online publishing division.

The IPO of VerticalScope Holdings, a former unit of Torstar that runs websites for hobbyist communities such as wood-workers and motorcyclists, raised about C$125 million ($103 million). The shares closed at C$22.95 in the first day of trading on Tuesday, valuing the remaining stake held by private equity firm NordStar Capital at C$180 million.

That’s about three times what NordStar spent last summer to buy Torstar, whose marquee asset is a