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The Star Tribune, the flagship newspaper of the McClatchy, is being sold to a private equity firm Avista Capital Partners for $530 million. This follows McClatchy’s purchase of Knight Ridder for $4.5 billion earlier this year, and selling off about 12 papers as part of portfolio reevaluation.
The Minneapolis, MN-based paper’s sale price is much less than the $1.2 billion McClatchy paid to buy the Star Tribune from Cowles Media Co. in 1998.
The deal covers the newspaper as well as other publications and websites related to the newspaper. McClatchy has no plans to divest further newspapers. Some more details in the release here.
Updated: AP: So was buying the Star Tribune in 1998 a mistake for McClatchy? McClatchy CEO Gary Pruitt said it wasn’t. He said Avista paid an attractive price for the paper, and that the Star Tribune was the only paper it could sell at a loss to get a tax benefit at a time when McClatchy needs one. And he said McClatchy has collected more than $1 billion in cash flow from Star Tribune operations during those years.