"They should have taken it up, they should have kept going," she said at a press conference this afternoon.
The New Zealand office of the German-owned company abruptly closed its doors permanently as a result of the Covid-19 crisis, bringing an end to long-running publications including Woman's Day, New Zealand Woman's Weekly, the Australian Women's Weekly, the Listener, North & South, Next, Metro, Kia Ora, Home NZ and Your Home & Garden.
Ardern said she was "gutted" to see Bauer close its doors, saying its magazines were part of New Zealand's history.
In a parting shot at its owners, she questioned claims that the company shut in New Zealand because of Covid-19.
The company not only refused to take up the wage subsidy, it proactively came to the Government and said it would not be using it.
"The wage subsidy could and should have made a difference to those staff," Ardern said.
She said the Government wanted to see the company continue to operate, maybe with more of an online presence.
The Government was aware that long-form journalism was under pressure and knew how important it was. It is looking into options to helping media, Ardern said.
Finance Minister Grant Robertson said the Government understood the "plurality of media".
But he said there needed to be more players than just the state-owned companies.
The Bauer closure brings to an end many decades of publishing in New Zealand, with about 300 staff out of jobs.
A staffer spoken to by the Herald said they were "devastated" and "didn't see it coming".
"There were plenty of tears shed. It's certainly a very grey day for New Zealand media.
"It's a big blow for magazines in New Zealand as they hold a special place in our country. Magazines have been in New Zealand for generations, they are a trusted friend and give comfort to many households."
The staffer said that though magazines were deemed non-essential by the Government, staff had still been working at home preparing to put out their next publication.
"This is a total shock. This is the end, it's awful."
She said the finer details such as redundancy payouts had yet to be confirmed.
"There are a lot of journalists out there who are really good at their job ... We are going to have to ride this crisis through and hope and wait for an economic upturn and wait for things to get back to normal."
Chief executive Brendon Hill told staff the news this morning in a company-wide Zoom meeting.
Bauer said the closure was because of the "severe economic impact of Covid-19".
EY has been appointed to work alongside Bauer New Zealand to facilitate an orderly wind-down of the business.
"This is a devastating blow for our committed and talented team who have worked tirelessly to inform and entertain New Zealanders, through some of the country's best-loved and most-read magazines," Hill said.
"We understand the New Zealand Government's decision to move to Covid-19 level 4, but it has put our business in an untenable position. Publishing in New Zealand is very dependent on advertising revenue and it is highly unlikely that demand will ever return to pre-crisis levels."
Bauer urgently reviewed its New Zealand operations and considered all options to keep part or all the business open, including engaging with the New Zealand Government, Hill said.
"An active search is under way to find buyers for our New Zealand assets, including our many iconic titles, however, so far an alternative owner has not been found."
Funding would be provided to enable all staff to be paid their full redundancy and leave entitlements.
"I would like to recognise the impact that this decision will have on our suppliers, customers and the wider publishing industry. This is a very difficult time for the entire media industry," Hill said.
