Newspaper publisher The McClatchy Company, which has agreed to purchase Knight-Ridder, the nation’s second-largest newspaper chain by circulation, has sold the last of the 12 Knight Ridder newspapers it plans to divest to a group led by HM Capital Partners. Terms of the deal were not disclosed.
McClatchy will sell the Times Leader of Wilkes-Barre, Pennsylvania to The Wilkes-Barre Publishing Company, an entity newly formed by former Times Leader publisher Richard Connor, local Wilkes-Barre investors and HM Capital Partners.
Today Knight-Ridder shareholders approved the sale to McClatchy, which is estimated at more than $4 billion plus an assumption of $2 billion in debt. McClatchy had announced in March that it would keep 20 Knight-Ridder newspaper and sell 12, from which it expects to make about $2.1 billion. The Times Ledger is the last newspaper to be sold.
Peter Brodsky, a partner with HM Capital, said the firm has a controlling share of the paper.
“As we always do with our investments, we will make corporate governance decisions,” he said. “But the operations of the paper will be run by Rich Connor on a day-to-day basis, and the operations of the paper will be very influenced by the local community, and that’s why we wanted to give local investors such a big stake.”
The Connor group beat out the paper’s current publisher, Pat McHugh, who had arranged a group of investors that had expressed interest in the paper.
This is the first investment in a newspaper by HM, but past and present media investments include Marcus Cable Company, AMFM Inc., Clear Channel Communications, Sunrise Television Corporation, LIN Television Corporation, Choice Cable, Yell!, Persona Communications and Canadian Phone Directories.
Dalas, Texas-based Hicks Muse Tate & Furst rebranded as HM Capital in March of this year just over a year after the retirement of Tom Hicks, the firm’s co-founder.