The company’s PR team is going to sell off its public relations operation to News Corp., according to an email from Edelman to clients obtained by CBC News.
Edelman will take a stake in MediaGram, a subsidiary of News Corp, which will own advertising and other assets.
The deal is subject to approval by News Corp’s board.
Edelmans communications director, Michael Schleicher, said the move to buy MediaGrams assets will be completed in the second half of the year.
Edelinams public relations team will continue to provide services to clients including the National Post and CBC, he said.
“This is part of our long-term strategy to support our clients’ business strategy in the digital age,” Schleil said.
The company has been under pressure to cut costs, as the industry grapples with a changing advertising landscape.
The public relations firm has also faced scrutiny for its contract with the Conservative Party of Canada to work as a consultant for Prime Minister Stephen Harper’s campaign.
The CBC has long been Edelman’s biggest client, accounting for roughly 30 per cent of its total revenue in 2015-16.
In its 2015-2016 annual report, Edelman said it was losing money every day, and was expected to lose more than $6 million in 2016-17.
Edelson is one of several media companies that have recently come under scrutiny in the wake of the CBC’s decision to sell advertising to News Corporation, including The Globe and Mail, which announced it would cut ties with Edelman in the summer.
In a statement to CBC News, News Corp said the decision to pull ads from Edelman came as part of its decision to “decouple our advertising business from our news operation.”
“We have taken a firm stance against political interference in our advertising programs,” said News Corp spokeswoman Sarah Smith.
“Edelman’s decision will have no impact on the news organization’s editorial coverage.”
The CBC said it had previously hired Edelman as a public relations consultant to help its newsrooms “develop strategies for better and more sustainable news coverage.”
“As the media landscape continues to change and as our audience grows, it is essential for newsrooms to continue to use the best PR and communications capabilities in their environments,” the CBC said in a statement.
“The CBC believes Edelman is a trusted partner that has a proven track record in the industry.”
The news organization said it plans to continue its relationship with Edelelman, but the two will be “separated” and Edelman won’t be paid for advertising.
News Corp will continue its coverage of the Liberal party, but “it is not a part of the editorial operations” at The Globe, the statement said.
Edels spokesperson Schleill said the company is still evaluating the move.
“We are very proud of our reputation as a PR firm and are looking forward to continuing to grow and invest in our global operations as the world moves into the digital era,” Schreil said in an email.