An Ontario judge has allowed insolvent media giant Canwest Global Communications to shuffle the money-losing National Post into a group alongside its other daily papers, which Canwest has said is the best hope of saving the daily newspaper from going under.

Judge Sarah Pepall, who is presiding over hearings into Canwest's restructuring, on Friday allowed the company to move the National Post into the Canwest Limited Partnership, which is not among divisions of the company currently operating under creditor protection.

A lawyer for Canwest had told court earlier Friday that not only would the move allow the National Post to keep operating, it is essential to a successful restructuring of the whole company.

"The business of the National Post and the LP entities (other Canwest newspapers and media outlets) are highly integrated and interdependent," said Lyndon Barnes.

"Without these agreements, the ability to restructure either of these entities is in doubt."

A number of divisions of Canwest, including the National Post Company, are restructuring under protection from its creditors after it amassed $4 billion in debt.

The company, which also operates the Global TV network, had asked to transfer the money-losing Post into the group that includes the Montreal Gazette, Vancouver's Sun and Province papers and the Ottawa Citizen in order to save cash.

In court documents, Canwest has said the Post has racked up about $62 million in losses over the past four years before factoring in interest, taxes, depreciation and amortization. It also owes $139.1 million to Canwest Media, its holding company, because it helped the company with payroll, capital expenditures and operational losses.

Canwest outlined an intricate operating system between the Post and the other newspapers it owns in the Limited Partnership.

The Winnipeg-based company said those operations extend from content sharing agreements for news stories to integrated payroll and customer support services, and that shutting down the Post would hurt all of the newspapers.

Chief financial officer John Maguire Maguire said in the filing that if the Post's Toronto operations had shut down, the company would have lost an integral part of its news team and been forced to pay about $500,000 a year to create or license Toronto-based news content. The Post is also expected to spend $11.6 million on printing and distribution services from other units of Canwest in 2010, he added.

About 277 people work at the national daily paper founded in 1998 by a the Southam group led by disgraced businessman Conrad Black.

Canwest has amassed $4 billion in money owed after buying Black's newspaper assets and the specialty channels owned by Alliance Atlantis.

Its expected that Canwest will explore the option of selling off its newspaper division to interested buyers, though representatives for the company have insisted the assets are not for sale.

The company is restructuring its entire operations with the hopes of completing the process by the end of January.

-By David Friend, The Canadian Press