By: E&P Staff In a very brief statement at mid-afternoon today, Knight Ridder Inc., finally commented on demands from some of its largest shareholders that the newspaper publisher put itself up for sale. Spokesman Polk Laffoon said its board is "always interested in the views of its shareholders."
Reading from a two-sentence statement, he said that the "board takes its fiduciary duties seriously and will respond in due course."
He did not confirm reports that the company had retained an investment bank to explore strategic options.
Shares of Knight Ridder were up $2.80, or 4.8%, to $61.88 in afternoon trading Thursday on the New York Stock Exchange.
Standard & Poor's on Thursday said it may cut Knight Ridder's ratings based on current uncertainty, accordign to Reuters. S&P rates the company's long-term credit at only "BBB-plus."
Merrill Lynch on Wednesday shifted its recommendation on KR to "underweight" from "market weight" on concerns the company will use debt to aggressively buy back shares or seek a buyer that likely uses debt to finance the purchase, Reuters noted.
Questions, meanwhile, continue to swirl around Bruce S. Sherman, chief executive of Private Capital Management LP in Naples, the man who started the frenzy of activity and speculation surrounding a possible break up or sale of Knight Ridder this week. Who is he? In short, he is ?known for having a golden touch with investments and brass knuckles when it comes to personal relationships,? Kris Hundley wrote today for the St. Petersburg Times.
Other details from that story:
--Sherman was schooled in Queens, N.Y. ?A former Arthur Young accountant in New York, Sherman was tapped in 1979 to handle the fortune of Miles Collier, whose family made billions in Florida real estate and advertising in the early 1900s. In 1986 Sherman arranged the sale of the family's Naples Daily News to Scripps-Howard for $170-million, nine times revenues. The same year, Sherman and Collier started PCM.?
--?Sherman's genius for finding undervalued companies and holding on for a long-term reward was profiled in the 1997 book Investment Gurus by Peter Tanous. Since then, Sherman, 57, has sniffed out at least four companies that were later acquired at double-digit profits by Warren Buffett. ?
--?In 2001, PCM was acquired by Baltimore's Legg Mason for up to $1.3-billion?Though PCM's portfolio of more than 100 stocks is broad-based, with holdings ranging from hospitals to banks to high-tech, in recent years Sherman has bulked up on newspaper chains. About 14 percent of PCM's money is invested in nine newspaper companies. In addition to Knight Ridder, PCM is the largest institutional owner of the New York Times (14.6 percent). It also owns 18.2 percent of Media General.?
-- ?Sherman hasn't developed a reputation as an activist shareholder like Carl Icahn, who is famous for breaking up companies to maximize profits. One exception: PCM pushed Oracle Corp. to up its bid for PeopleSoft.?
Comments
No comments on this item Please log in to comment by clicking here