The head of the company that holds a minority interest in The Seattle Times Co. said Tuesday he's willing to part with that stake. "Long-term, we would be...
The head of the company that holds a minority interest in The Seattle Times Co. said Tuesday he’s willing to part with that stake.
“Long-term, we would be open to selling,” McClatchy President and Chief Executive Gary Pruitt said in response to a shareholder’s question at the company’s annual meeting Tuesday in Sacramento, Calif.
McClatchy, the nation’s third-largest newspaper chain, owns a 49.5 percent interest in The Times. Pruitt said he had communicated McClatchy’s willingness to sell to the Blethen family, which controls the other 50.5 percent.
But McClatchy spokeswoman Elaine Lintecum said the most important word in Pruitt’s comment was “long-term.” The company is not actively shopping its stake in The Times, she said.
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There’s little reason to, said newspaper analyst John Morton of Silver Spring, Md.
“I don’t know who would buy it other than the Blethens,” he said, “and I’m not sure they have the money.”
McClatchy has almost no say in how The Times Co. is run. Its revenue from The Times consists solely of quarterly dividends, whose amounts both companies declined to disclose.
From The Times’ perspective, spokeswoman Corey Digiacinto said, Pruitt’s remarks “aren’t a reflection of any change.” She declined further comment.
Publicly traded McClatchy, the privately held Times Co. and most other newspaper owners have been hit hard by declining advertising revenues in recent years.
McClatchy’s stock price has dropped 77 percent since the beginning of 2007.
It recently listed the “carrying value” of its stake in The Times Co. at $12.1 million, down from $102.2 million at the end of 2006.
But carrying value is an accounting measure that is not synonymous with market value, and Morton said the Blethens, or any other buyer, almost certainly would have to pay significantly more than that.
“I don’t think it bears any resemblance to reality,” he said. “Bad as things are, they’re not that bad.”
McClatchy acquired its stake in The Times two years ago, when it purchased Knight Ridder, which had held the 49.5 percent interest since the 1920s.
The Blethens’ relations with Knight Ridder were rancorous, but from all accounts they get along well with McClatchy.
Pruitt’s comment Tuesday doesn’t reflect any deterioration in that relationship, both companies said.
Information from The Sacramento Bee is included in this report.
Eric Pryne: 206-464-2231 or email@example.com