McClatchy said Monday that it has an agreement to sell the majority of its 15 percent ownership in CareerBuilder LLC in a deal expected to net the Sacramento company $76 million.
McClatchy, publisher of The Sacramento Bee and 29 other newspapers, said the agreement to sell its stake in the online employment site also includes co-owners Tegna Inc. and Tribune Media Co. Tegna is the controlling shareholder with a 53 percent stake.
The agreement calls for the media firms to sell to an investor group led by investment funds managed by affiliates of Apollo Global Management and the Ontario Teachers’ Pension Plan Board, headquartered in Toronto.
Parties expect the deal to close in this year’s third quarter, subject to standard closing conditions and regulatory approvals.
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For McClatchy, the deal will create an infusion of cash – after-tax sale proceeds of $68 million and an additional $8 million as part of Chicago-based CareerBuilder’s normal distribution to shareholders.
The current three co-owners will retain a minority ownership stake in CareerBuilder. McClatchy said its stake will be approximately 3.8 percent.
Craig Forman, McClatchy’s president and CEO, said in a statement: “Our CareerBuilder interest has been a valuable asset over the years, and we wish the company well in navigating the future. For McClatchy, the result of the TEGNA-led CareerBuilder transaction will provide after-tax proceeds to further reduce debt and/or potentially use for reinvestment in the company.”
McClatchy’s stake in CareerBuilder had a profound effect on its first-quarter earnings this year, with $76.8 million of its reported quarterly loss of $95.6 million related to a write-down of its investment in CareerBuilder.
The Sacramento company said it will record a non-cash impairment of $45 million to $55 million in this year’s second quarter in connection with the prospective sale.
McClatchy inherited its CareerBuilder stake as part of its 2006 takeover of newspaper chain Knight Ridder Inc. for $4.4 billion.