Star Tribune publisher's memo to the newspaper staff

I'm sure you are wondering what prompted McClatchy to sell the Star Tribune. In making the announcement, McClatchy President and CEO Gary Pruitt, said: "The Star Tribune is a great newspaper with talented staff and management. It is a profitable business that has generated significant returns for the company over the years.

"However, as we continued to analyze our business following the Knight Ridder acquisition, it became clear that selling the Star Tribune strengthens McClatchy's competitive position. This decision will better align our portfolio for today's changing media environment."

McClatchy, in its public announcement, says a detailed analysis of the company's portfolio identified a number of unique financial tax benefits associated with the sale of the Star Tribune that would serve the long-term interests of the company and its shareholders.

I want to thank Gary and all of those at McClatchy for their investment in the Star Tribune since buying the newspaper in 1998. Their steady, forthright stewardship has been appreciated and has made the newspaper, its web site and other interests better. We wish them nothing but the best going forward.

After the sale closes, the Star Tribune will be run by a board of directors appointed by Avista. I will be on the board.

Chris Harte, a member of Avista's executive advisory board, will serve as Chairman of the Star Tribune, and I will report to Chris.

Chris is a highly experienced newspaperman, who served as publisher of Knight Ridder newspapers in Akron, Ohio and State College, Penn., and was publisher of the Guy Gannett Company newspaper in Portland, Maine.

In his remarks to Star Tribune employees today, Chris said:

"The Star Tribune has proven to us that it can change, diversify and grow in the face of changing market conditions.

"You have strong management, hard-working and talented employees, a strong market and a powerful brand that you know how to leverage. That, in a nutshell, is why we found this acquisition so attractive.

"Avista Capital Management is a company that prides itself on creating long-term value by supporting strong management teams and finding new strategies for growth. We are patient investors who look to the future*

"We have not only invested in an exceptionally strong brand but also in the people in every department of this company who make it what it is.

"We at Avista look forward to working with you in making the Star Tribune grow and prosper." Keith Moyer

Publisher and President

I am truly excited by the prospects of working with Chris and Avista and know you will be too.

Going forward, it will be business as usual during the transition from McClatchy to Avista. We'll put out a great newspaper tomorrow, and we'll continue to do so every day of every year to come -- and I know all of you can be counted on to make sure of that.

And starting today and throughout the transition, we'll be telling you more about Avista and its other holdings and we'll be providing you with answers as they become clear to your likely questions concerning this change of ownership. Go to Stribnet for regular updates on the transition.

Thank you.