Posted on 03/25/2006 3:59:02 AM PST by abb
NEW YORK A union representing newspaper workers complained Friday that it was not receiving full access to financial information from The McClatchy Co. that it needs to make a bid on 12 newspapers that McClatchy wants to sell.
McClatchy said earlier this month that it intended to sell the papers, which include The Philadelphia Inquirer and the San Jose Mercury News, as part of its deal to acquire Knight Ridder Inc., the nation's second-largest newspaper company. McClatchy intends to keep the other 20 papers owned by Knight Ridder.
The Newspaper Guild-CWA said it was told by McClatchy that the union could not have full access to financial information about the 12 papers since it wasn't part of the original bidding process for all of Knight Ridder, which began last fall.
Nonetheless, Jeff Miller, a spokesman for the Communications Workers of America, of which the guild is an affiliate, said the union-backed group still planned to submit a bid by the Tuesday deadline based on the partial financial information that it did receive.
McClatchy said in a statement that it has received "scores" of inquiries from prospective buyers about the papers, but declined to comment on the sale process.
However the company also said that after receiving the bids it would "carefully consider each of them and act in the best interest of McClatchy, taking into account the interests of stakeholders including shareholders, employees, readers, advertisers and communities."
The union is working with The Yucaipa Cos., an investment firm run by California billionaire Ron Burkle, on arranging its bid. The union complained about the matter in a letter to McClatchy CEO Gary Pruitt and to the company's board of directors.
Robert Hall, a former publisher of The Philadelphia Inquirer and the Philadelphia Daily News, who is now working as an adviser to the union-backed group, had said Thursday that the bid for all 12 papers would go forward, but at that time he did not mention any difficulties gaining access to necessary financial data.
On Friday he said that as of Thursday the group had still thought that it would get access to the information. He said that once the bid is submitted next week, he expected that McClatchy would provide it with fuller access to the information, and that the group would ask for additional time to fully consider it.
"To us, it seems like the process is flawed, and that's why we're complaining," Hall said.
Gannett Co. has said it is considering bids for some of the 12 newspapers, though it didn't say which ones. MediaNews Group Inc., a privately held newspaper company based in Denver, is also widely believed to be interested in the papers. MediaNews Group has not returned repeated calls, including one made Friday
Let the union have them. Then they both can sink to the bottom.
Here's the WaPo's spin on this story
http://www.washingtonpost.com/wp-dyn/content/article/2006/03/24/AR2006032402048.html
If all goes according to the newspaper union's plan, 12 newspapers that are for sale will eventually be owned by the workers themselves as part of a buyout effort by the Yucaipa Cos., a private equity firm.
Yucaipa will bid Tuesday on the papers that McClatchy Co. said it would sell when it acquired 32 dailies from Knight Ridder Inc. earlier this month. If Yucaipa's bid succeeds, employees will be able to invest in the papers through their retirement savings plans.
One management team would run the corporation established for the 12 papers.
They would join an increasing number of workers in industries including airlines and steel who have taken an ownership interest in their workplaces. The number of employee stock ownership plans (ESOPs), grew from 10,670 in 1996 to 11,500 in 2005, according to the National Center for Employee Ownership. Two daily newspapers, in Omaha and Milwaukee, already are part-owned by ESOPs, which reduce federal income taxes for company owners.
"It will start off 100 percent owned by Yucaipa and then more and more by employees," Newspaper Guild-CWA President Linda Foley, said of the proposed arrangement for the Knight Ridder papers. "We would like it to be majority-owned by employees, eventually 100 percent."
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