US local newspaper company McClatchy has been sold out of Chapter 11 bankruptcy to Chatham Asset Management, owner of American Media Inc (publisher of the National Enquirer) and Canada’s Postmedia. The deal, after a competitive bidding process, is thought to be worth $300m (including debt) although terms have not been disclosed and the deal remains subject to court approval.
It is believed the company, based in Sacramento, California, will not be broken up. McClatchy publishes 29 US daily newspapers including the Miami Herald, Kansas City Star, Fort Worth Star-Telegram, and Sacramento Bee.
The company, family-owned throughout 163 years, became enmeshed in debt following its acquisition of Knight-Ridder (then the country’s second largest news company after Gannett) in 2006. It has struggled with declining revenues and circulation ever since. Chatham Asset Management was both McClatchy’s largest shareholder and creditor when the company entered bankruptcy proceedings.
