<PAGE>

NEWS RELEASE TRANSMITTED BY CCNMATTHEWS

FOR: HOLLINGER INC.

TSX SYMBOL:  HLG.C, HLG.PR.B

December 31, 2004

Hollinger Inc. Provides December 30, 2004 Status Update

TORONTO, ONTARIO--(CCNMatthews - Dec. 31, 2004) -

Commissions Independent Governance Study and Appoints Communications Advisor

Hollinger Inc. ("Hollinger") (TSX:HLG.C)(TSX:HLG.PR.B) provides the following
update in accordance with the guidelines pursuant to which the June 1, 2004
management and insider cease trade order was issued. These guidelines
contemplate that Hollinger will normally provide bi-weekly updates on its
affairs until such time as it is current with its filing obligations under
applicable Canadian securities laws. Reference should be made to Status Update
Reports and other press releases that have been previously filed by Hollinger
and which are available on SEDAR at www.sedar.com.

Hollinger and Hollinger International Inc. ("Hollinger International") continue
to pursue, on a without prejudice basis, the conclusion of mutually acceptable
arrangements to permit the audit of Hollinger's 2003 annual financial statements
to begin as soon as possible.

Hollinger's 2003 annual financial statements cannot be completed and audited
until Hollinger International's 2003 annual financial statements are completed.
Based upon public statements previously made by Hollinger International, it was
expected that its 2003 annual financial statements would have been issued this
week. However, now Hollinger International has advised Hollinger that it and its
auditors need additional time to review the final report of the investigation by
the Special Committee established by Hollinger International, which report was
released on August 30, 2004, and to assess its impact, if any, on the results of
operations of Hollinger International before it can complete and file its 2003
annual financial statements.

In its press release of December 29, 2004, Hollinger International indicated
that it expects to be able to complete its financial statements (and related
MD&A) for its fiscal year ended December 31, 2003 by no later than mid-January,
2005, and within approximately two months thereafter to complete its interim
financial statements for the fiscal quarters ended March 31, June 30 and
September 30, 2004. This is a necessary but not sufficient condition to permit
Hollinger to complete and file its financial statements for the same periods as
the completion and audit of Hollinger's financial statements will require a
level of co-operation from Hollinger International and its auditors which is
still in negotiation.

<PAGE>

Following the filing of Hollinger International's financial statements,
Hollinger's Audit Committee will consider what, if any, additional financial
information and/or alternative financial statements Hollinger will be in a
position to publicly disclose and/or complete as a consequence of Hollinger
International's filing.

Ernst & Young Inc. (the "Inspector") is continuing the inspection of Hollinger's
related party transactions pursuant to an Order of the Superior Court of Justice
of Ontario made pursuant to s. 229(1) of the Canada Business Corporations Act.
The Inspector has now provided four interim Reports with respect to its
inspection of Hollinger. The Fourth Interim Report dated December 22, 2004 is to
be provided to the Court before the parties appear next before Justice Colin L.
Campbell on January 6 and 7, 2005. Hollinger and its staff have given their
full, unfettered and unrestricted assistance to the Inspector in carrying out
its duties, including access to all files and electronic data. Hollinger
International has also assisted the Inspector in this regard.

Hollinger announced on December 16, 2004 that it has commissioned Carol Hansell,
a Partner in the Toronto law firm Davies Ward Phillips & Vineberg LLP, and
retired Major-General Richard Rohmer, a former Hollinger Director and Counsel to
the law firm of Rohmer and Fenn, to review its corporate governance practices
and to recommend changes. The report of Ms. Hansell and Major-General Rohmer is
expected to be presented to Hollinger's Board in January 2005. Separately,
Hollinger has appointed Hill & Knowlton Canada for ongoing communications
counsel and advice.

As of the close of business on December 24, 2004, Hollinger and its subsidiaries
(other than Hollinger International and its subsidiaries) had approximately
US$9.44 million of cash or cash equivalents on hand and Hollinger owned,
directly or indirectly, 782,923 shares of Class A Common Stock and 14,990,000
shares of Class B Common Stock of Hollinger International. Based on the December
29, 2004 closing price of the shares of Class A Common Stock of Hollinger
International on the New York Stock Exchange of US$18.31, the market value of
Hollinger's direct and indirect holdings in Hollinger International was
US$288,802,220. All of Hollinger's direct and indirect interest in the shares of
Class A Common Stock of Hollinger International are being held in escrow with a
licensed trust company in support of future retractions of its Series II
Preference Shares. All of Hollinger's direct and indirect interest in the shares
of Class B Common Stock of Hollinger International are pledged as security in
connection with Hollinger's outstanding 11.875% Senior Secured Notes due 2011
(the "Senior Notes") and 11.875% Second Priority Secured Notes due 2011 (the
"Second Priority Notes"). In addition, Hollinger has previously deposited with
the trustee under the indenture (the "Senior Indenture") governing the Senior
Notes approximately US$10.5 million in cash as collateral in support of the
Senior Notes (which cash collateral is also collateral in support of the Second
Priority Notes, subject to being applied to satisfy future interest payment
obligations on the outstanding Senior Notes as permitted by amendments to the
Senior Indenture). Consequently, there is currently in excess of US$284.9
million aggregate collateral securing the US$78 million principal amount of the
Senior Notes and the US$15 million principal amount of the Second Priority Notes
outstanding.

<PAGE>

On December 17, 2004, the Board of Directors of Hollinger International declared
a special dividend of US$2.50 per share of Class A Common Stock and Class B
Common Stock (collectively, the "Shares") of Hollinger International to holders
of record of such Shares on January 3, 2005, payable on January 18, 2005. The
Board of Directors of Hollinger International also declared a regular quarterly
dividend of US$0.05 per Share to be paid on January 18, 2005 to shareholders of
record on January 3, 2005. Based on the number of Shares currently owned
directly or indirectly by Hollinger, on January 18, 2005, Hollinger will be
entitled to receive an aggregate of US$39,432,307.50 in respect of the special
dividend and an aggregate of US$788,646.15 in respect of the regular dividend on
the Shares. Hollinger International previously agreed not to block any payment
to Hollinger unless it is required to do so by a court order (which it will not
seek), statute or regulation. There is to be no reduction or set-off. Hollinger
in turn previously agreed to an extension of the injunction granted by
Vice-Chancellor Strine in Delaware limiting Hollinger's control of Hollinger
International beyond its original October 31, 2004 expiration date to the
earlier of the date the proceeds from the strategic process have been
distributed to Hollinger International's shareholders and January 31, 2005.

The special dividend declared by Hollinger International will result in it
distributing approximately US$227 million of the net proceeds from the sale of
The Telegraph Group. In announcing the declaration of the special dividend,
Hollinger International stated that it was committed to distributing to its
shareholders, including Hollinger, a total of US$500 million of the net proceeds
of the sale of The Telegraph Group. It proposes to distribute the balance of
these proceeds in the form of a tender offer for shares of its Common Stock
after it publishes its delinquent financial statements and other reports.
Alternatively, Hollinger International may consider a further special dividend
but it gave no assurances that it would distribute cash to shareholders in
either form.

Hollinger commenced honouring retractions of its Series II Preference Shares on
October 28, 2004. On retraction, each Series II Preference Share is exchangeable
into a fixed number (being 0.46) of shares of Class A Common Stock of Hollinger
International or, at Hollinger's option, cash of equivalent value. To date, such
retractions have been effected by Hollinger delivering 0.46 of a share of Class
A Common Stock of Hollinger International owned directly or indirectly by it in
exchange for each retracted Series II Preference Share. Since October 28, 2004,
Hollinger has delivered 9,637 shares of Class A Common Stock of Hollinger
International and no cash pursuant to retractions of its Series II Preference
Shares. Retractions of Hollinger's outstanding retractable common shares
submitted after May 31, 2004 continue to be suspended until further notice.

Company Background:

Hollinger's principal asset is its approximately 68.0% voting and 18.2% equity
interest in Hollinger International. Hollinger International is a newspaper
publisher whose assets include the Chicago Sun-Times and a large number of
community newspapers in the Chicago area, a portfolio of new media investments
and a variety of other assets.

<PAGE>

-30-

FOR FURTHER INFORMATION PLEASE CONTACT:

Hill & Knowlton
Larry Parnell
Media contact:
(416) 413-4623
larry.parnell@hillandknowlton.ca
www.hollingerinc.com

INDUSTRY:  MED
SUBJECT:   LAW

-0-