Content area
Some also suspect McClatchy already has an offer for at least some of the 12, which the Sacramento, Calif.-based chain will acquire as part of a $6.5 billion deal struck over the weekend. McClatchy executives said repeatedly Monday that they are sure they will find buyers for the papers and may even have simultaneous closings when the deal goes through several months from now.
Among the papers McClatchy plans to sell are two of Knight Ridder's biggest and most respected, the Philadelphia Inquirer and the San Jose Mercury News.
Knight Ridder's corporate headquarters is in San Jose, Calif. Also on the sell list are the St. Paul Pioneer Press, the Duluth News Tribune and the Grand Forks (N.D.) Herald.
The McClatchy Company's decision to immediately divest 12 of the 32 daily newspapers it agreed to buy from Knight Ridder Inc. may have taken some employees at both chains by surprise, but analysts said the move makes sense for McClatchy.
Some also suspect McClatchy already has an offer for at least some of the 12, which the Sacramento, Calif.-based chain will acquire as part of a $6.5 billion deal struck over the weekend. McClatchy executives said repeatedly Monday that they are sure they will find buyers for the papers and may even have simultaneous closings when the deal goes through several months from now.
McClatchy said it was selling most of the papers because they don't fit the company's high-growth strategy.
Possible buyers include newspaper companies that expressed an early interest in Knight Ridder, such as MediaNews Group and Gannett. Other possible suitors include Lee Enterprises and the Newspaper Guild, a labor union.
Among the papers McClatchy plans to sell are two of Knight Ridder's biggest and most respected, the Philadelphia Inquirer and the San Jose Mercury News.
Knight Ridder's corporate headquarters is in San Jose, Calif. Also on the sell list are the St. Paul Pioneer Press, the Duluth News Tribune and the Grand Forks (N.D.) Herald.
McClatchy said it is selling all but the Pioneer Press because they don't fit its acquisition criteria - newspapers in markets with higher-than-average household growth rates.
"We care about these papers," McClatchy CEO Gary Pruitt said in a conference call on Monday. "We are sorry that we're not retaining them, [but] they don't fit our strategy."
McClatchy, which owns the Star Tribune, said antitrust concerns drove its decision to sell the Pioneer Press.
"We think we can find buyers for all the newspapers we'll put up for sale," said Robert Weil, vice president of operations for McClatchy, during a Monday afternoon staff meeting in the Star Tribune newsroom.
Analysts reacted favorably. "The choices make perfect sense to me," said Edward Atorino, a media analyst at Benchmark Capital, a New York based brokerage firm. "It's a well-thought-out plan."
But investment banker Larry Grimes said he believes another factor is behind the decision to sell the venerable papers: McClatchy wants to bring in cash fast to pay down the acquisition debt.
"I tend to believe that McClatchy has numerous offers for these papers and has deals in place, or at least offers in place," said Grimes, in Gaithersburg, Md.
Gannett, MediaNews Group, Lee Enterprises and the Thomas H. Lee Partners, an investment group that reportedly bid on Knight Ridder, either didn't return calls Monday or declined to comment.
The Newspaper Guild, which had proposed buying the nine Knight Ridder newspapers where it has members, said it will consider a bid for all 12 of the castoff papers. It's working with Yucaipa Companies, an investment fund in Los Angeles. The plan calls for independent investors and employees at the newspapers to own them.
Several analysts expressed doubt that it could succeed, partly because it has never been done.
"But more importantly, these deals could get too expensive for a venture group," Grimes said.
.
H.J. Cummins - 612-673-4671
.
McClatchy daily newspapers
The News Tribune (Tacoma)
Tri-City Herald (Kennewick)
The Sacramento Bee
The Modesto Bee
Merced Sun-Star
The Fresno Bee
Anchorage Daily News
Star Tribune
The Herald (Rock Hill)
The News & Observer (Raleigh)
Beaufort Gazette
The Island Packet (Hilton Head Island)
.
Knight Ridder daily newspapers
The Bellingham Herald
The Olympian (Olympia)
The Idaho Statesman (Boise)
The Tribune (San Luis Obispo)
Kansas City Star
The Olathe News
The Wichita Eagle
Belleville News-Democrat
Fort Worth Star-Telegram
Sun Herald (Biloxi)
Columbus Ledger-Enquirer
The Telegraph (Macon)
The Herald (Bradenton)
el Nuevo Herald (Miami)
Miami Herald
The Sun News (Myrtle Beach)
The State (Columbia)
Lexington Herald-Leader
The Charlotte Observer
Centre Daily Times (State College)
.
Knight Ridder daily newspapers to be sold
Contra Costa Times
San Jose Mercury News
The Herald (Monterey County)
Grand Forks Herald
American News (Aberdeen)
Duluth News Tribune
St. Paul Pioneer Press
The News-Sentinel (Fort Wayne)
Akron Beacon Journal
The Times Leader (Wilkes-Barre)
Philadelphia Inquirer
Philadelphia Daily News
Photo: MAP
(Copyright 2006 Star Tribune)