New Knight Ridder owner will sever three major northern California newspapers

By Jason Bennert, Bay City News Service

March 13, 2006

Three Northern California newspapers face uncertain futures today after the company buying the Knight Ridder newspaper chain announced that it would be selling the San Jose Mercury News, Contra Costa Times and Monterey Herald.

Sacramento-based McClatchy Co. has agreed to buy the Knight Ridder chain for $6.5 billion including $2 billion in assumed debt, but this morning McClatchy CEO Gary Pruitt announced that the company would sell 12 of Knight Ridder's 32 daily newspapers almost immediately including the three Northern California papers.

"These are terrific publications but simply do not fit with our long standing acquisition and operating strategies,'' Pruitt said.

Two likely buyers for the Northern California papers are Media News Group, which owns the Oakland Tribune, Marin Independent Journal and several other Bay Area newspapers, and the Newspaper Guild, the union representing workers at the Mercury News and Herald, according to John McManus, director of gradethenews.org, a Web site affiliated with San Jose State and Stanford universities that provides criticism and analysis of Bay Area journalism.

"I think that Dean Singleton is going to be very interested in those papers,'' McManus said. "The Guild is also interested.''

Singleton is the CEO of Media News Group.

Luther Jackson, the executive director of the San Jose Newspaper Guild, which represents employees at both the Mercury News and Herald, said the national Newspaper Guild is interested in acquiring all 12 of the papers McClatchy wants to sell.

"Rather than sitting on the sidelines we're in the game,'' Jackson said.

The quality of the Mercury News, Herald and Times would most likely improve if the Newspaper Guild acquired the three papers, according to Jackson.

"Generally speaking at employee-owned companies there tends to be higher productivity because you're working for yourself,'' Jackson said.

McManus believes that the three Northern California newspapers will ultimately be owned by Media News Group.

"If I were betting I would bet they would all end up in the Media news pocket,'' McManus said.

McClatchy did not include the Silicon Valley Community Newspaper group, which includes the Palo Alto Daily News and other local papers on the Peninsula, on the list of Knight Ridder properties that it planned to sell. A McClatchy spokeswoman was not immediately available to comment on the company's plans for the SVCN papers.

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