After 21 years in business, Toronto, Canada-based Owl Communications, publisher of Owl, Chickadee and Chirp children’s magazines, has laid off its 40-member staff and put its TV productions on hold. According to Owl president Annabel Slaight, the company is in the process of restructuring, which includes negotiations with potential buyers.

The announcement follows a January deal between Combined Media and Mackerel Multimedia. As part of the deal, Combined Media took over 90 percent of Owl Communications and dropped the troubled company’s non-profit status. Combined Media provided the working capital to embark on an ambitious business plan, projecting to double Owl’s production slate this year to 40 hours and break into high-budget family programming.

Owl was set to co-produce the 26-episode Cdn$3 million (US$2.2 million) live-action kids series The Max Show, and the second season of the Mrs. Cherrywinkle series for Family Channel. Slaight anticipates that both projects will go forward.

Owl TV had also initiated talks with the Canadian Broadcasting Corporation to license Mighty Mites, a live- action/animated series and develop a half-hour drama series for adolescents. Owl TV has currently withdrawn from both projects.

According to Mackerel Multimedia’s president Gord Gower, problems began when Owl TV and Mackerel’s production levels fell below target and they failed to generate cash flow. This was compounded by the debts Owl and Mackerel brought into the deal. The working capital Combined Media brought to the January deal, he says, did not provide enough of a window to get their ambitious slate of projects off the ground.