Minneapolis – Newspaper publisher McClatchy Co. said Tuesday it will sell its flagship newspaper Star Tribune to a private-equity firm for $530 million, a sharp drop from the $1.2 billion it paid to acquire the newspaper eight years ago.
McClatchy said it decided to sell the newspaper to Avista Capital Partners through a private bidding process “after a strategic re-evaluation of its portfolio of holdings” following McClatchy’s purchase of Knight Ridder for $4.5 billion this year.
McClatchy faces a large tax bill from selling off 12 other newspapers this year as part of its purchase of Knight Ridder. It said the tax benefit of selling the Star Tribune at a loss is worth $160 million, raising the total value of the deal to $690 million.
Gary Pruitt, chairman and chief executive of McClatchy, said in a written statement that the Star Tribune “is a profitable business that has generated significant returns for the company over the years.”
