Southam Inc said a Canadian governmentofficial asked the Ontario Supreme Court to order Southam to
seek shareholder approval of a 1985 share swap between Southam
and fellow newspaper publisher Torstar Corp &lt;TSB.TO>.
    Frederick Sparling, an official in the Department of
Consumer and Corporate Affairs, wants the share exchange
nullified if shareholder approval is not obtained, Southam
added.
    Southam said it believed it had acted properly and would
vigorously defend itself in what would probably be a lengthy
process.
    Sparling's action came after a year-long investigation by
the federal corporations branch in response to minority
shareholders' complaints about the share exchange, which gave
Torstar a 22 pct stake in Southam.
    Southam said at the time of the Torstar deal that the share
swap was necessary to avert a hostile takeover bid for Southam
by a third party.
    The company declined further comment while the case is
before the courts.
 Reuter
