McClatchy to Sell the Wilkes-Barre (PA) Times Leader to Investor Group Led by Richard Connor and HM Capital Partners
SACRAMENTO, CA and WILKES-BARRE, PA, JUNE 26, 2006 - The McClatchy Company today announced a definitive agreement to sell the Times Leader of Wilkes-Barre, PA to the Wilkes-Barre Publishing Company Inc., a firm newly formed by Richard L. Connor in partnership with local Wilkes-Barre investors and HM Capital Partners, LLC. The purchase covers the Times Leader and certain publications and websites related to the newspaper. Terms of the transaction were not disclosed.
Dirks, Van Essen & Murray, a newspaper merger-and-acquisition firm based in Santa Fe, New Mexico, represented McClatchy in the transaction.
The Times Leader (daily circulation 40,960 and Sunday circulation 55,714) is currently owned by Knight-Ridder, Inc., which McClatchy has agreed to acquire. The parties intend to close the transaction as soon as possible after the close of McClatchy’s acquisition of Knight Ridder, subject to regulatory approvals and customary closing conditions.
Mr. Connor served as president and publisher of the Times Leader from 1978 to 1986 and is chairman of Texas Community Newspapers, based in Fort Worth, Texas. HM Capital Partners has a long track record of successful investment in media-related enterprises.
"This sale represents a win for all the stakeholders: readers, advertisers, employees and the community of Wilkes-Barre. We were particularly pleased to find buyers with community roots and direct experience with the Times Leader. Experienced management and committed owners will serve them well," said Gary Pruitt, chief executive officer of McClatchy. "We wish the staff and management every success as they work together to build an even stronger newspaper going forward."
Mr. Connor said, "We are excited by the opportunity to continue the tradition of solid journalism that has been practiced here for many years and to remain a committed member of the community. Wilkes-Barre has been and will remain a great newspaper town."
"With this sale, we have reached agreements on all 12 papers we intended to divest, and done so ahead of closing the acquisition of Knight Ridder," Pruitt said. "We know all these buyers have the long-term best interests of the communities, publications and employees at heart." In all, McClatchy stands to receive about $2.1 billion from buyers of the 12 papers, a total that represents a multiple of 11 times their trailing 12-month cash flows.
McClatchy, headquartered in Sacramento, California, is a leading newspaper and internet publisher. It publishes 12 daily and 16 non-daily newspapers located in western coastal states, North and South Carolina, and the Twin Cities of Minneapolis/St. Paul. McClatchy has daily circulation of 1.4 million and Sunday circulation of 1.8 million. McClatchy's newspapers include, among others, the Minneapolis (MN) Star Tribune, The Sacramento Bee, The Fresno Bee and The Modesto Bee in California, the Raleigh (NC) News & Observer, the Tacoma (WA) News Tribune the Anchorage (AK) Daily News and Vida en el Valle, a bilingual Spanish weekly newspaper distributed throughout California’s Central Valley. McClatchy also operates leading local websites in each of its daily newspaper markets, offering readers information, compre-hensive news, advertising, e-commerce and other services, and owns and operates McClatchy Interactive, an interactive operation that provides websites with content, publishing tools and software development. McClatchy is listed on the New York Stock Exchange under the symbol (MNI).
HM Capital Partners, based in Dallas, is a private equity firm that leverages its sector expertise to acquire, change and build strategically relevant businesses. The firm is currently managing a $1.6 billion fund. Its past and present media investments include, among others, Marcus Cable Company, AMFM Inc., Clear Channel Communications, Sunrise Television Corporation, LIN Television Corporation, Choice Cable, Yell!, Persona Communications and Canadian Phone Directories.