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Tuesday, November 7, 2000

By Dennis Oda, Star-Bulletin
Canadian publisher David Black says there are a few
points to be worked out before he has a deal to buy the
Honolulu Star-Bulletin. He said he expects to
become the new owner soon.

may soon have
new owner

David Black says he hopes
to have a deal 'in the
next day or so'

By Mary Adamski

Canadian publisher David Black is "getting closer" to completing an agreement to buy the Honolulu Star-Bulletin following a long day of negotiations.

"I hope we're going to get it done in the next day or so," Black said last night at the end of an all-day meeting with representatives of Gannett Co. and the Star-Bulletin's owner, Liberty Newspapers Limited Partnership. "We haven't got a deal yet but we are much closer than at the beginning of the day."

Star-Bulletin closing after 117 years Black said there are two points still being negotiated. "We're down to severance (pay) and newsprint and we're pretty close. We think there is a solution in sight, so we're very pleased."

The Gannett contingent and Liberty attorneys declined to comment as they left the federal courthouse just after 8 p.m. They returned to Virginia last night aboard a corporate jet. In response to questions, Thomas Chapple, Gannett senior vice president and general counsel, referred reporters to U.S. Magistrate Barry Kurren.

The parties were scheduled to appear before Kurren at 11 a.m. yesterday, the deadline set by the court to approve or terminate Black's proposed purchase of the 118-year-old paper.

The formal hearing was not held, but Kurren kept the parties meeting in a closed courtroom throughout the afternoon and into the evening. The judge said at midafternoon that he intended to keep the parties in negotiations because "this has lasted long enough."

Characterizing the meeting, Black said "it is a much better tone than the last meetings. We were getting things done. People are still protective of their turf ... but we're getting closer."

Negotiations began more than a month ago, after the court accepted Black, owner of Black Press Ltd., as the only viable bidder for the afternoon newspaper. The company, based in Victoria, B.C., publishes 80 community newspapers in western Canada and Washington state.

The federal court has overseen the newspaper sale since anti-trust lawsuits were filed a year ago by the state attorney general and a community group, Save Our Star-Bulletin. The suits were in response to Liberty's announcement in September 1999 that it would close the Star-Bulletin, terminating its joint operating agreement with the Gannett-owned Honolulu Advertiser. Liberty was to have received $26.5 million from Gannett to do so.

The problem of securing newsprint remains because there is not enough paper available at a "reasonable price to do the job," Black said. Gannett has lined up two sources, one on the East Coast, where "the price is sky high," and through an Oregon supplier, which is still "a maybe," he said. Black said he would need more than the 5,000 tons used last year because he plans to publish a Sunday paper.

The severance pay issue that remains is connected to the Hawaii Newspaper Guild contract, which provides that a terminated employee be paid one week's salary for each year of employment, with a minimum of five weeks pay. Black said he balks at assuming the severance burden for the years prior to his ownership.

A local Gannett official put out a news release on the eve of the hearing, claiming that the negotiations had reached a "major snag." Advertiser publisher Mike Fisch said Black refused to accept the contract covering Star-Bulletin employees.

Black said during a midafternoon break that it was "a nonissue." He said last night that he expects to begin meeting with the Hawaii Newspaper Guild this week.

Under the terms of the sale, a buyer is required to assume terms of the union contract.

Guild administrative officer Wayne Cahill said: "We look forward to meeting with him."

Deputy Attorney General Rodney Kimura and James Bickerton, attorney for Save Our Star-Bulletin, waited at the court until 5 p.m. Any sale agreement would require their approval, in return for which the lawsuits would be withdrawn.

"I'm glad they're still talking," Kimura said. "This is a big transaction. There is a lot at stake. It's understandable that the process takes time."

Bickerton said "I remain optimistic. Significant progress was made today."

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