Just call it creative destruction

A story by Richard Siklos in the New York Times on March 19, 2006 is the best summary I have seen so far on the Knight Ridder sale. You can click on the headline above to see the piece, but you will have to register (for free) to read the full story.

The headline said:

Media Frenzy
Before Its Time, the Death of a Newspaper Chain

Salient points in the story:

Distressed Tony Ridder: "He wasn't a good operator,"

The newspaper industry: Under a cloud because readers and advertisers are migrating to the Internet, where news is largely free

Stock value: $67.25 when the deal was announced. Today $62.74 and McClatchy $48.20

Bruce Sherman: in the end may eke out a small profit.
"When the world thinks you may have struck out, it's not bad when you hit a single," he said after the deal was announced.

Another Ghost: What would have happened if Knight Ridder had made a bold declaration that the sky was not falling on newspapers? It might have said that other media company stocks have suffered just as much in the last year and thanked McClatchy for its kind offer, but decided it could do better as a going concern. Apparently, this latter bit was just too depressing for Mr. Ridder to contemplate, but was what Mr. Pruitt of McClatchy had in mind all along. It's called creative destruction.