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Tuesday, January 25, 2000

Star-Bulletin closing after 117 years

Hearst Corp.
sweetens deal for
SF Examiner sale

The offer now includes
physical assets needed
to put out a paper

By Kim Curtis
Associated Press


SAN FRANCISCO (AP) -- The Hearst Corp. is making a new effort to find a buyer for the San Francisco Examiner, adding trucks, printing presses and other assets to the deal along with the newspaper's name and subscriber list.

Examiner publisher Timothy O. White said Tuesday the offer was sweetened to hasten the sale of the paper and alleviate antitrust concerns from local, state and federal officials about Hearst's proposed purchase of the paper's longtime rival, the morning San Francisco Chronicle.

"I feel that the logjam we have lived with for five months is being broken," White told the Examiner.

In August, Hearst said it planned to buy the Chronicle for $660 million and sell the afternoon Examiner, but only its name and goodwill, not the physical assets needed to put out a paper. If no qualified buyer were found, Hearst said it would merge the two newspapers.

The original offer attracted no buyers, White said Tuesday. "Whether this was seen as a phony offer or sham ... this should set those criticisms aside," he said.

The Justice Department is continuing its investigation, spokeswoman Gina Talamona said Tuesday.

Stephen Barnett, a professor at the University of California's Boalt Law School and expert on newspaper competition issues, said the change in terms "creates a more realistic chance of selling the Examiner."

For the public, he said, "It means there is a chance of not only continuing to have two daily papers, but having two daily papers that really compete with each other."

Since 1965, the papers have been subject to a joint operating agreement, employing separate news staffs and competing for stories, but sharing printing and business operations and profits. The San Francisco JOA expires in 2005, but last year the owners of Chronicle Publishing decided to sell the company's assets.

Whether the JOA might be transferred to a new Examiner owner was not specifically addressed in Hearst's statement Tuesday.

Knight Ridder CEO Tony Ridder said in November he might be interested in buying the paper "if we could step into Hearst's shoes and have the Examiner and their position in the JOA." He was traveling Tuesday and unavailable for comment.

The Chronicle is the nation's 13th-largest daily newspaper, with a circulation of 456,000. The Examiner, the flagship of the media empire William Randolph Hearst began 112 years ago, has a circulation of 107,129 daily, and 578,541 when its news sections are combined with Chronicle features on Sunday.

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