Tribune and Gannett Up Their Stake in CareerBuilder, McClatchy Keeps 15%

By: Jennifer Saba After months of negotiations, CareerBuilder?s one-third stake has finally been settled.

Jointly owned by Tribune, Gannett, and now-defunct Knight Ridder, Tribune and Gannett have decided to increase their stake in the online recruitment company to 42.5% each.

McClatchy will receive $310 million and will retain 15% of CareerBuilder.

The transaction also includes ShopLocal.com and Topix.net, which was jointly owned by the three companies. Gannett and Tribune will increase their share to 42.5% in ShopLocal and 31.9% in Topix. McClatchy will retain a 15% stake in ShopLocal and an 11.25% stake in Topix.

The agreement values CareerBuilder at $1.5 billion, ShopLocal at $85 million, and Topix.net at $72 million.

Gannett and Tribune had first right of refusal over Knight Ridder?s stake in these Internet companies when McClatchy acquired Knight Ridder at the end of June. Gannett and Tribune will each pay McClatchy $142 million for CareerBuilder (and $13 million for ShopLocal and Topix).

The deal allows McClatchy to elect one member to CareerBuilder?s six-member board. (Tribune and Gannett each elect two members).

?This agreement is a winning deal for McClatchy, CareerBuilder, and our other online partners, Gannett and Tribune,? McClatchy?s CEO Gary Pruitt said in a statement. ?McClatchy receives fair value for our shares 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."

Executives with Tribune and Gannett had signaled over the past few months their desire to grow their share in Internet properties, including CareerBuilder.

?Maintaining a strong coalition of newspapers partners is critical to strengthening the newspaper industry in a challenging environment,? Craig Dubow, Gannett?s CEO, said in a statement. ?With committed owners and a powerful network of affiliated newspapers serving more than 200 local markets, CareerBuilder will be stronger than ever.?

The online recruitment site was founded in 1995. In 2002, Gannett, Tribune, and Knight Ridder jointly took over the company with equal shares.

CareerBuilder?s main competitor, Monster.com, announced last week that it had signed a deal with its first major newspaper partner, Philadelphia Media Holdings, the new owner of The Philadelphia Inquirer and Daily News.

Under Knight Ridder's ownership, the Philadelphia papers were once part of CareerBuilder's network.