DOJ Requires Divestiture for Knight Ridder – McClatchy Merger

On June 27, the Department of Justice announced that it will require The McClatchy Company and Knight Ridder Inc. to divest the St. Paul Pioneer Press in order to proceed with their proposed multi-billion dollar newspaper merger. The DOJ said that the transaction, as originally proposed, would have eliminated head-to-head competition between McClatchy and Knight Ridder and likely would have resulted in higher prices for advertisers and readers in the Minneapolis/St. Paul metropolitan area.
Under the terms of the consent decree, Knight Ridder can merge with and into McClatchy, but McClatchy must divest the St. Paul Pioneer Press. According to the complaint, McClatchy's Star Tribune competes aggressively for advertisers and readers with Knight Ridder's St. Paul Pioneer Press. The Department said that competition between the two newspapers has resulted in lower prices and better quality news coverage for readers and lower advertising rates and better service for local advertisers. Ownership of both the Star Tribune and St. Paul Pioneer Press would have given McClatchy control of the only two daily newspapers serving the cities of Minneapolis and St. Paul in Minnesota and the surrounding area.