Posted on 04/27/2006 9:15:39 AM PDT by abb
NEW YORK While Wednesday's announcement that MediaNews Group plans to snap up four Knight Ridder papers puts to rest several months of uncertainty, Newspaper Guild leaders are calling the convoluted deal "bad news for newspaper workers, readers, advertisers, and for our communities."
San Jose Newspaper Guild Executive Officer Luther Jackson called an emergency meeting scheduled at 6 p.m. local time tonight for San Jose members to "review the implications" of the pending transaction. A meeting for Monterey members will be announced separately.
The guild wants to address many issues, including media concentration, but is also charging that Yucaipa Co. -- the private equity firm that placed a bid on all 12 orphan Knight Ridder papers on behalf of the guild -- did not get a fair shake in negotiations with McClatchy over the California papers.
The guild has "serious" concerns about whether Yucaipa received enough time for the due diligence process.
"This raises questions about the fairness and transparency of the sale process, about whether that process satisfies McClatchy's fiduciary obligations to shareholders, and about the commitment to seek a buyer that will represent the journalistic excellence of all 12 papers," said Jackson in a statement.
Guild President Linda Foley told the Mercury News, "This certainly doesn't appear to be something that was open and transparent. This really does smack of a back-room deal. I find the deal very troubling because of its complex nature and because of the fact it involves so many of these large media companies that compete with one another.''
If the MediaNews' deal goes through for three California papers -- the San Jose Mercury News, the Contra Costa Times, and The Monterey County Herald -- the private Denver-based chain will control 43 daily and weekly papers in the Bay Area with a total circulation of 814,000. By comparison, the San Francisco Chronicle (owned by Hearst) has a daily circulation of 400,906. Additionally, MediaNews will acquire the St. Paul Pioneer Press in Minnesota.
In a statement, the guild's leadership said it's considering a "range of options including outreach to governmental agencies responsible for regulating corporate ownership and governance issues as well as unspecified collective actions."
According to the guild, California Attorney General Bill Lockyer has announced it will look into the transaction to ensure it doesn't violate any antitrust laws.
The President of the Newspaper Guild's Knight Ridder Council Henry Holcomb said in a statement that while the deal might work out to serve the communities, "It is troubling that business enterprises that have a financial interest in limiting competition are working with self-imposed secrecy to craft a complex deal that appears to be designed to evade official scrutiny."
Jennifer Saba (jsaba@editorandpublisher.com) is associate editor for E&P
Dinosaur Media Ping
Don't it make you positively giddy? LOL!!
Left Wing Media Monopoly: The only good monopoly. :)
The piece is not clearly written, but it appears that the guild (union) tried to buy the newspapers out and lost the bid. They are simply trying to reverse the sale and have the newspapers handed over to the guild. Standard union thinking and action.
You are correct. The unions supposedly hooked up with Ron Burkle's group (Yucaipa) for the so called 12 "orphan" papers that McClatchy didn't want. May yet succeed on the Inky in Philly...
Next Up for McClatchy: Philly, as NY 'Daily News' Joins Hunt
By E&P Staff
Published: April 27, 2006 10:30 AM ET
NEW YORK With four papers among the "Deserted Dozen" in the original Knight Ridder/McClatchy suddenly gone, to MediaNews Group, attention shifted today to Philadelphia where a number of investors have been touring the facilities of the Inquirer and Daily News all week.
Executives from a possible fresh suitor--the New York Daily News--are expected to meet today with investment bankers and managers at the two papers.
Marc Z. Kramer, chief executive officer of Daily News L.P., "and half a dozen of his colleagues are scheduled to visit the Philadelphia newspapers' Broad Street headquarters with investment bankers from Credit Suisse First Boston, according to people familiar with the discussions," Joseph DiStefano reports in today's Philadelphia Inquirer. The New York Daily News is owned by Mortimer B. Zuckerman.
The Inquirer counts the Daily News as "among at least five entities that have expressed interest in the Philadelphia newspapers."
Philip Meyer, Knight professor of journalism at the University of North Carolina at Chapel Hill, told DiStefano that since the New York Daily News is not a public corporation, "Wall Street analysts won't be looking at your quarter-to-quarter earnings. That's exactly the relief that the Philadelphia papers need."
MediaNews is not out of the running, along with several local investor groups and even a group from Canada.
E&P Staff
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