Gannett, McClatchy and Tribune Reach Ownership Agreement on CareerBuilder, ShopLocal.com and Topix.net
Gannett Co., Inc. (NYSE: GCI), The McClatchy Company (NYSE: MNI), and Tribune Company (NYSE: TRB), today announced an agreement concerning their ownership stakes in CareerBuilder.com, the nation’s largest online classified recruitment site, and two other online businesses, ShopLocal.com and Topix.net. Under the agreement, Gannett and Tribune will increase each of their equity stakes in CareerBuilder and ShopLocal.com to 42.5%, and in Topix.net to 31.9%.
McClatchy will receive a total of approximately $310 million in the transaction and will retain a 15% stake in CareerBuilder and ShopLocal.com, and an 11.25% stake in Topix.net. McClatchy’s newspapers will become affiliated with each online business.
The agreement values CareerBuilder at $1.55 billion, ShopLocal.com at $85 million and Topix.net at $72 million. McClatchy acquired its ownership position in all three Internet companies following the completion of its purchase of Knight Ridder on June 27. Knight Ridder, Gannett and Tribune had previously been equal partners in CareerBuilder. To increase their equity stake in CareerBuilder, Gannett and Tribune will each pay McClatchy approximately $142 million. They will each pay $13 million to increase their equity in ShopLocal.com and Topix.net.
McClatchy will elect one member of CareerBuilder’s six-member board of directors. The board will be composed of two directors chosen by Gannett, two by Tribune, one by McClatchy, and CareerBuilder’s chief executive officer, Matt Ferguson.
“As a founding partner of CareerBuilder, Tribune is pleased to have McClatchy join as an important partner in these online ventures,” said Dennis FitzSimons, Tribune chairman, president and chief executive officer. “Increasing our ownership position in CareerBuilder, ShopLocal.com and Topix.net is consistent with our Internet growth strategy. With great partners like Gannett, and now McClatchy, the national network/local affiliate model is working very well for us. We’ll continue using this successful approach as we look to further expand Tribune’s Internet portfolio.”
“We are pleased to expand our ownership position in each of these companies and form an alliance with McClatchy,” said Craig A. Dubow, Gannett chairman, president and chief executive officer. “Maintaining a strong coalition of newspaper partners is critical to strengthening the newspaper industry in a changing environment. With committed owners and a powerful network of affiliated newspapers serving more than 200 local markets, CareerBuilder will be stronger than ever.”
“This agreement is a winning deal for McClatchy, CareerBuilder, and our other online partners, Gannett and Tribune,” said Gary Pruitt, chairman and chief executive officer of McClatchy. “McClatchy receives fair value for our share of these assets, while retaining a sizable enough equity position to expand our footprint online. Our preference has always been to continue participating in CareerBuilder as a partner with our industry colleagues.”
EXPANDING NEWSPAPER PARTNERSHIPS
Twenty of the newspapers McClatchy acquired from Knight Ridder were already affiliated with CareerBuilder, ShopLocal, and Topix.net, and will continue to be so. McClatchy’s 12 existing newspapers will now join the recruitment website and the other newly acquired digital platforms, establishing CareerBuilder partnerships in new markets, like Sacramento and Raleigh, with more than 3.7 million people.
“Our newspaper partners are an important contributor to the growth of CareerBuilder,” said Matt Ferguson, CareerBuilder’s president and chief executive officer. “The addition of the McClatchy newspapers combined with those of our existing partners, Gannett and Tribune, will make our network stronger and even more competitive.”
For the last two years, CareerBuilder has led the industry in job postings and traffic. This year it also became the leader in U.S. revenue, passing its largest competitor for the first time.