Justice Department looks at offers for Star-Bulletin


POSTED: Tuesday, April 20, 2010

Bids to buy the Honolulu Star-Bulletin, including several that involve assets not for sale, are being reviewed by the U.S. Justice Department, according to sources familiar with the deal.

Bids were due by 5 p.m. yesterday. The newspaper has been on the market since March 15, when Black Press listed it to satisfy Justice Department requirements regarding a planned purchase of the Honolulu Advertiser from Gannett Co.

Frederick “;Derick”; Harris, the Big Island owner of Cyber ID, said yesterday that he had met the final bid deadline. Hawaii Reporter editor Malia Zimmerman and state Sen. Sam Slom (R, Hawaii Kai-Kahala) did not return calls yesterday, although Slom said Friday that they planned to bid.

Brian Ferguson, managing principal of Texas-based Anthem Newspaper Holdings LLC, said earlier that his team had submitted several proposals.

He declined to confirm Anthem's plans yesterday, but sources said they had heard that he planned to submit four bids outside the sale's scope. One bid was expected to come in too low to satisfy liquidation requirements, which sources expect were in the range of $1.5 million to $2 million. Another bid allegedly sought all assets of Oahu Publications, which owns the Star-Bulletin and MidWeek, which was not put up for sale. A third bid was thought to have included some assets formerly owned by Gannett, and a fourth was said to have been contingent upon forming another joint operating agreement between the Advertiser and the Star-Bulletin.


Justice officials did not return a call.

U.S. Sen. Daniel Inouye was expected to send a letter to the Justice Department asking for a review of the sale to ensure that it meets antitrust laws. Wayne Cahill, administrative officer for the Hawaii Newspaper Guild, said the union's attorney has asked Justice officials to delay the deal to investigate antitrust implications.

If the Star-Bulletin is not sold, Black will operate the papers independently for 30 to 60 days before merging them into one paper, the Honolulu Star-Advertiser. Black's purchase of the Advertiser is expected to close Sunday.

Meanwhile, Advertiser union employees, who will be laid off by Gannett when the deal with Black closes, will meet at 3 p.m. Sunday at the ILWU Hall. Most of these employees were offered transitional “;at-will”; jobs last week by HA Management Inc., a firm hired by Black to run the Advertiser until he takes it over.