McClatchy sells 4 papers

Six weeks after announcing a deal to buy the nation's second-largest newspaper company, McClatchy Co. has agreed to sell four Knight Ridder Inc. newspapers to MediaNews Group Inc. for $1 billion.

The four papers -- three in California and one in Minnesota -- are among 12 that McClatchy has said it intends to sell because they don't meet its acquisition criteria, which include being located in rapidly growing markets.

The deal announced Wednesday increases the profile and reach of MediaNews, a privately held company based in Denver and run by William Dean Singleton. With financial backing from Hearst Corp., another newspaper publisher, MediaNews will wind up owning the San Jose Mercury News, the Contra Costa Times, the Monterey County Herald and the St. Paul Pioneer Press.

Singleton's interest in the newspapers had been widely known. The three northern California papers complement his existing holdings, which include The Oakland Tribune and the Marin Independent Journal. MediaNews owns a number of newspapers in geographic clusters, which helps reduce production and other costs and also allows for group advertising sales.

Knight Ridder was forced to put itself up for sale last fall following a revolt of its three largest shareholders, who were frustrated with the company's lagging stock price.

McClatchy announced a deal to buy Knight Ridder in mid-March for $4.5 billion in cash and stock, plus the assumption of $2 billion in debt.

Once the deal is complete, McClatchy will have eight additional Knight Ridder newspapers to sell: the American News in Aberdeen, S.D.; the Akron Beacon Journal; the Duluth News Tribune in Minnesota; the Grand Forks Herald in North Dakota; the Philadelphia Daily News and The Philadelphia Inquirer; The News-Sentinel in Ft. Wayne, Ind. and The Times Leader in Wilkes-Barre, Pa.

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