TORONTO — There's been a shakeup in the upper ranks of the Toronto Star, Canada's largest-circulation newspaper, with both the publisher and editor-in-chief being replaced Monday.

Gone from the Star are publisher Michael Goldbloom and editor-in-chief Giles Gherson, who had run the paper since 2004.

Jagoda Pike, who joined the Star's parent company in 1986 and has held a variety of senior positions within the organization including publisher of the Hamilton Spectator, was appointed publisher of the Star and president of the newly formed Star Media Group.

The Star Media Group will include the Star, Torstar's interests in the Metro commuter newspaper, and Sing Tao Daily, Eye Weekly, Toronto Real Estate News, TMG-TV, Torstar Syndicate Services and Corporate Information Technology.

"Creating the Star Media Group with Jagoda as its leader will improve alignment among our various properties, simplify our newspaper business and reduce corporate costs,'' Robert Prichard, president and chief executive of parent company Torstar Corp. (TSX:TS), said in a statement.

Fred Kuntz, who has risen through the ranks within the Torstar group since starting as a copy editor while studying at Ryerson's journalism school, was named editor-in-chief.

"I wanted it in '79 but they told me I was too young," Kuntz said in a brief e-mail exchange.

Kuntz has most recently been publisher of The Waterloo Region Record and Guelph Mercury, two sister papers to the Star in southern Ontario.

Pike said Monday evening she planned to meet with Star employees on Tuesday but didn't anticipate any major changes at the daily.

"All of that is very much premature,'' Pike said. "As I have in all my prior assignments, (we will) look at all aspects of the business -- whether it's our cost levels, whether it's how we grow revenue.

"I think we, in particular, have to focus on growth and be very, very conscious of how we spend our money. But, no, there is nothing drastic or severe coming down the pipe.''

A spokeman for the union that represents much of the Toronto Star's employees, speaking from Vancouver where the union leadership was meeting at a major convention, said he took some comfort in Pike's words.

"As long as the plans to grow the business and create new financial opportunities doesn't include watering down the main product, the Toronto Star and its subsidiary papers, then that's fine by us,'' said Mike Sullivan, national director for the Communications, Energy and Paperworkers union.

"But we would, of course, not be happy if any of the workers at the Toronto Star are adversely affected by this. We're certainly interested in helping the Star make lots of money because it would make our members richer too, we would hope.''

In his resignation letter to staff, Goldbloom noted "these are exceptionally challenging times in the newspaper business.''

Goldbloom, a former publisher of the Montreal Gazette, listed a decline of newsstand sales at the paper, loss of classified advertising to the Internet, the increasing demands of advertisers and the emergence of alternative sources for news.

Among the accomplishments that Goldbloom listed in the same letter were stabilizing the Star's readership after a challenging 2005 and sustaining the Star's journalistic tradition.

"I am particularly pleased that, unlike so many other papers across North America, we have not reduced the staffing levels in the newsroom,'' Goldbloom wrote.

In its latest quarter, Torstar reported earnings fell 28 per cent to $25.6 million on revenue of $390.3 million amid slack advertising linage at the Star as well as a tumble at the romance fiction subsidiary Harlequin Enterprises Ltd., largely blamed on the robust Canadian dollar.

Earlier this month, Harlequin revealed it is cutting four per cent of its global workforce of about 1,100 as part of a restructuring aimed at saving $3 million a year.

The women's fiction division -- which generates about one-third of Torstar's revenue and generates almost all of its earnings outside Canada -- has seen its profits squeezed by the stronger loonie and sharper competition.

Torstar -- which also owns community newspapers in Ontario, interests in other publications as well as TV operations and a stake in the Bell Globemedia company -- had a total workforce of 6,825 full-time employees at the end of last year.

On Monday, Torstar shares rose 17 cents to close at $19.37 on the Toronto Stock Exchange.