As most of our readers know – Julian and I are Knight Ridder Digital Alumni. We chronicled our thoughts about the KR sale back in January here. Julian said of the pending sale:
It really pains me to see our old company, Knight Ridder Digital, up for sale (Shannon and I are both KRD alumni, and it’s actually where we met). Everyone knows that current Knight Ridder shareholders are looking for bigger profits and valuation from the looming sale. They’ll get some of that but only if they recognize what they really have and invest in it. I’ve been surprised that none of the press has talked about other companies that could stand to benefit from buying Knight Ridder other than the (yawn) other newspaper companies and private equity firms (cringe) that have been named as likely suitors. I know there are good arguments as to why other companies aren’t being discussed, especially interactive companies like Yahoo! or Google, but I think that’s all wrong. Yes, print is going down hill – no kidding – but that doesn’t mean that there isn’t value in the product, it is great local content after all, and even though the Google’s and Yahoo!’s of the world are more about dismantling old models like the one KR operates under it doesn’t have to be that way.
While Julian is particularly passionate about ‘local’ – for me – it has always been recruitment. I was the SE Regional Manager of the Careers Channel at KRD (KR.com at that time) during the KR/Trib acquisition (Gannett joined later after initially turning the deal down) of CareerBuilder.com. Back in January, we pondered what would happen to the CB piece of the KR sale – secretly (or not so secretly since we blogged about it) hoped that maybe Yahoo would make a play for that piece of the business:
Knight Ridder’s online recruitment revenue’s are about 40% of their total online revenue and it only keeps growing. If Yahoo!, currently third in the online recruitment space to CareerBuilder’s second, purchased Knight Ridder they would become a Monster.com squashing powerhouse. Yeah, Tribune and Gannett, the other owners of CareerBuilder would have to agree to the sale but I think they could find it in their hearts to get in bed with Yahoo!, especially if Yahoo! extended some of their other offerings to them. I don’t think it hurts that the CEO of HotJobs, Dan Finnigan, used to run Knight Ridder Digital and was a chief architect of the CareerBuilder acquisition. After working for Dan at both Knight Ridder Digital and before that, SBC’s SMARTpages.com I saw first hand what a great biz dev talent he is and I can’t believe Dan’s not thinking about these things and talking them over with Terry Semel, CEO of Yahoo!.
But alas, no Google, no Yahoo!, no interactive anything – it looks like the other 2 current owners (Tribune & Gannett) want all the pie for themselves to thwart the inevitable decline of their core product. Today from The New York Times:
Portions of job recruitment Web site CareerBuilder.com are up for grabs, The New York Times reported in its Thursday editions.
Gannett Co. (GCI), the Tribune Co. (TRB), and Knight Ridder Inc. (KRI) each own one-third of CareerBuilder. Their contractual arrangement provides that if any of the owners sold their stake, the others could buy that owner’s equity.
Earlier this year, when Knight Ridder was sold to McClatchy (MNI), Gannett and Tribune said they wanted to buy back Knight Ridder’s stake in CareerBuilder. Knight Ridder is to be sold officially to McClatchy next week. When that happens, Gannett and Tribune have the right to buy what will become McClatchy Co.’s (MNI) one-third, at market value, the Times reported.
Tribune Co. has indicated that it wants to own more than its current one-third of CareerBuilder, but the Times reported beyond that, it is unclear how the pie might be divided.
So what will ‘McRidder’ be worth to McClatchy after they sell their most valuable asset? And for that matter what about McRidder’s value after selling some of those lauded KR properties like The Mercury News and Philadelphia Inquirer? It sure makes the new combined company a lot less attractive if you ask me.