-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SgjKYJ0ASLPcpfL+q6kF+XrFPVhY9kt5bCj4/4ZAEbcMtiFSNyi182yqKNEsXJ2g npjRCuJewmHzBZAYPlW5ug== 0000897226-05-000215.txt : 20051110 0000897226-05-000215.hdr.sgml : 20051110 20051110091210 ACCESSION NUMBER: 0000897226-05-000215 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20051110 DATE AS OF CHANGE: 20051110 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: KNIGHT RIDDER INC CENTRAL INDEX KEY: 0000205520 STANDARD INDUSTRIAL CLASSIFICATION: NEWSPAPERS: PUBLISHING OR PUBLISHING & PRINTING [2711] IRS NUMBER: 380723657 STATE OF INCORPORATION: FL FISCAL YEAR END: 1227 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-16367 FILM NUMBER: 051192022 BUSINESS ADDRESS: STREET 1: 50 W SAN FERNANDO ST CITY: SAN JOSE STATE: CA ZIP: 95113 BUSINESS PHONE: 4089387700 MAIL ADDRESS: STREET 1: 50 W SAN FERNANDO ST CITY: SAN JOSE STATE: CA ZIP: 95113 FORMER COMPANY: FORMER CONFORMED NAME: KNIGHT RIDDER NEWSPAPERS INC /FL/ DATE OF NAME CHANGE: 19860707 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: PRIVATE CAPITAL MANAGEMENT CENTRAL INDEX KEY: 0000897226 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 593654603 STATE OF INCORPORATION: FL FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 8889 PELICAN BAY BLVD STREET 2: STE 500 CITY: NAPLES STATE: FL ZIP: 34108 BUSINESS PHONE: 9412542525 MAIL ADDRESS: STREET 1: 8889 PELICAN BAY BLVD STREET 2: STE 500 CITY: NAPLES STATE: FL ZIP: 34108 FORMER COMPANY: FORMER CONFORMED NAME: PRIVATE CAPITAL MANAGEMENT INC /FL DATE OF NAME CHANGE: 19950223 SC 13D/A 1 kria.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Amendment 1 Under the Securities Exchange Act of 1934 Knight-Ridder, Inc. (Name of Issuer) Common Stock, par value $0.02 1/12 per share (Title of Class of Securities) 499040103 (CUSIP Number) Mr. Chad Atkins Private Capital Management, L.P. 8889 Pelican Bay Blvd. Suite 500 Naples, FL 34108 (239) 254-2500 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) November 10, 2005 (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [X] CUSIP No. 499040103 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only). Private Capital Management, L.P. (I.R.S. Number 59-3654603) Mr. Bruce S. Sherman Mr. Gregg J. Powers 2. Check the Appropriate Box if a Member of a Group (a) (b) 3. SEC Use Only 4. Source of Funds (See Instructions) OO 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) 6. Citizenship or Place of Organization Private Capital Management, L.P. Delaware Mr. Bruce S. Sherman USA Mr. Gregg J. Powers USA 7. Sole Voting Power Private Capital Management, L.P. 0 Mr. Bruce S. Sherman 0 Mr. Gregg J. Powers 0 8. Shared Voting Power (Estimated as of 11/10/2005) Private Capital Management, L.P. 9,100,000 Mr. Bruce S. Sherman 9,100,000 Mr. Gregg J. Powers 9,100,000 9. Sole Dispositive Power Private Capital Management, L.P. 0 Mr. Bruce S. Sherman 0 Mr. Gregg J. Powers 0 10. Shared Dispositive Power Private Capital Management, L.P. 12,764,105 Mr. Bruce S. Sherman 12,764,105 Mr. Gregg J. Powers 12,764,105 11. Aggregate Amount Beneficially Owned by Each Reporting Person Private Capital Management, L.P. 12,764,105 Mr. Bruce S. Sherman 12,764,105 Mr. Gregg J. Powers 12,764,105 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares 13. Percent of Class Represented by Amount in Row (11) Private Capital Management, L.P. 19.0% Mr. Bruce S. Sherman 19.0% Mr. Gregg J. Powers 19.0% 14. Type of Reporting Person (See Instructions) Private Capital Management, L.P. IA Mr. Bruce S. Sherman IN Mr. Gregg J. Powers IN This amendment 1 supplements and amends the Schedule 13D filed by Private Capital Management, L.P. ("PCM") on November 1, 2005 (along with exhibits, the "November 1 Filing"). Item 3 is hereby amended as follows: Source and Amount of Funds or Other Consideration. PCM currently maintains investment discretion over 12,764,105 shares of Common Stock which were acquired on behalf of its clients at an aggregate purchase price of $836,974,194.06. Funds for these purchases were derived from PCM clients. Item 4 is hereby supplemented as follows: Purpose of Transaction. As described in the November 1 Filing, the shares of Common Stock of the Company were purchased by the Reporting Persons on behalf of Private Capital Management, L.P. clients for investment purposes. On November 3, 2005, two additional large shareholders of the Company made Schedule 13D filings addressing concerns raised by the Reporting Persons in the November 1 Filing. Also on November 3, 2005, a spokesman for the Company publicly acknowledged the filings made by shareholders and stated that the Company would respond to its shareholders "in due course." In light of the Company's limited response to the serious concerns raised by a significant portion of the Company's shareholders, the Reporting Persons are currently reviewing governance options and other courses of action regarding the Company and anticipate that they may nominate a slate of directors for election by shareholders at the Company's 2006 annual meeting. The actions ultimately initiated by the Reporting Persons, if any, will in part depend on the Reporting Persons' evaluation of actions taken or proposed by the Company and others. In addition, the Reporting Persons expect to unilaterally engage in other activities focused on realizing fair value for the Company's shareholders including, among other things, engaging in discussions with the Company, other shareholders and third parties regarding issues related to the maximization of shareholder value. In making this filing and engaging in activities described herein and in the November 1 Filing, the Reporting Persons are acting and intend to continue to act on their own accord on behalf of Private Capital Management clients and not in concert with any other investor or as a part of any group. Except as set forth herein and in the November 1 Filing, Private Capital Management has no present plans or proposals that would result in or relate to any of the transactions or changes listed in Items 4(a) and 4(j)of Schedule 13D. Item 5 is hereby amended as follows: Interest in Securities of the Issuer. (a) Number of Percentage Reporting Person Shares of Shares Private Capital Management, L.P. 12,764,105 19.0% Mr. Bruce S. Sherman 12,764,105 19.0% Mr. Gregg J. Powers 12,764,105 19.0% As Chairman of PCM, Mr. Sherman may be deemed to be a beneficial owner of shares of the Common Stock held in PCM client accounts. As President of PCM, Mr. Powers may also be deemed to be a beneficial owner of shares of the Common Stock held in PCM client accounts. While Mr. Sherman, Mr. Powers and PCM may be deemed to be beneficial owners of shares of the Common Stock held in PCM client accounts, the filing of this Schedule 13D shall not be construed as an admission that such persons are the beneficial owners of any such securities. PCM, Mr. Sherman and Mr. Powers each disclaims ownership of the shares of the Common Stock held in the accounts of PCM clients. (b) PCM currently exercises voting authority over shares of Common Stock held in the accounts of PCM clients that have delegated proxy voting authority to PCM. Such voting authority may be withdrawn by PCM clients at any time. Sole power to vote or direct the vote: Private Capital Management, L.P. 0 Mr. Bruce S. Sherman 0 Mr. Gregg J. Powers 0 Shared power to vote or direct the vote: Private Capital Management, L.P. 9,100,000 Mr. Bruce S. Sherman 9,100,000 Mr. Gregg J. Powers 9,100,000 (Estimated as of 11/10/2005) Sole power to dispose or to direct the disposition: Private Capital Management, L.P. 0 Mr. Bruce S. Sherman 0 Mr. Gregg J. Powers 0 Shared power to dispose or direct the disposition: Private Capital Management, L.P. 12,764,105 Mr. Bruce S. Sherman 12,764,105 Mr. Gregg J. Powers 12,764,105 (c) The following table sets forth the Reporting Persons' transactions in the shares of the Common Stock during the last 60 days: Private Capital Management, L.P. All transactions listed in the schedule below were client directed and PCM did not exercise any investment discretion. Number of Average Transaction Date Shares Price Per Share Effected 9/22/05 300 59.09 Open Market Sale 9/28/05 400 57.93 Open Market Sale 10/05/05 800 57.69 Open Market Sale 10/11/05 500 55.96 Open Market Sale 10/12/05 600 55.05 Open Market Sale 10/12/05 2600 55.29 Open Market Purchase 10/13/05 5000 55.17 Open Market Sale 10/18/05 1100 54.66 Open Market Sale 10/19/05 1400 53.62 Open Market Sale 10/20/05 1600 54.02 Open Market Sale 10/21/05 700 53.18 Open Market Sale 10/24/05 1505 53.88 Open Market Sale 10/25/05 1000 53.86 Open Market Sale 10/26/05 5300 54.00 Open Market Sale 10/27/05 4800 54.02 Open Market Sale 10/28/05 2300 53.90 Open Market Sale 10/31/05 9100 53.43 Open Market Sale 11/01/05 400 57.36 Open Market Sale 11/02/05 2400 59.05 Open Market Sale 11/03/05 4000 61.36 Open Market Sale 11/04/05 2500 61.80 Open Market Sale 11/07/05 9000 63.14 Open Market Sale 11/08/05 4900 61.86 Open Market Sale 11/09/05 500 61.70 Open Market Sale The table above does not reflect shares removed from PCM's investment discretion by clients. Mr. Bruce S. Sherman No Transactions Mr. Gregg J. Powers No Transactions (d) PCM, an investment advisor registered under the Investment Advisors Act of 1940, pursuant to investment advisory contracts with its clients has shared dispositive power over the shares of the Common Stock in the PCM investment advisory accounts of clients. The individual clients, none of whom individually owns beneficially more than 5% of the total class of such securities, have the right to receive or the power to direct the receipt of dividends from, and the proceeds from the sale of the shares of the Common Stock. (e) Not applicable Item 7. Exhibits. Exhibit 1 - Letter to the Board of Directors of of Knight-Ridder, Inc., dated November 1, 2005. Copy previously filed with November 1 Filing. After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: November 10, 2005 PRIVATE CAPITAL MANAGEMENT, L.P. By: /s/Bruce S. Sherman Bruce S. Sherman, CEO /s/Bruce S. Sherman Bruce S. Sherman, CEO /s/Gregg J. Powers Gregg J. Powers, President EX-1 2 kri2.txt November 1, 2005 Board of Directors Knight Ridder, Inc. 50 W. San Fernando Street Suite 1500 San Jose, CA 95113 Dear Board Members: I am writing on behalf of Private Capital Management, L.P. ("PCM"), Knight Ridder's largest shareholder. On behalf of its clients, PCM has been an investor in Knight Ridder since April 2000 and its clients currently hold approximately 19% of the Company's outstanding shares. On July 19, 2005, at the invitation of Knight Ridder's Chairman and CEO, Tony Ridder, I addressed the Company's Board on behalf of PCM regarding our concerns with the performance of the Company's stock. As I stated to the Board at that meeting, PCM has long respected Knight Ridder for its distinguished history of serving the public and for the collection of high quality local market newspaper assets that the Company has assembled. However, in light of limited revenue growth across the newspaper industry and the difficulties the Company has faced in realizing the fair value of the Company for its shareholders, we believe the Board should now aggressively pursue the competitive sale of the Company. PCM remains supportive of actions undertaken by the Company following the July 19 Board meeting, so far as they went, to create shareholder value. Nevertheless, as was the case in July and is increasingly the case since, a significant and persistent disparity exists between the fair value of the Company's assets and the trading range of its shares. Since the July 19 Board meeting the Company has raised its dividend; authorized the repurchase of 10,000,000 shares; completed the repurchase of more than 5,000,000 shares; acquired and disposed of a number of newspaper assets; and announced staffing reductions. During that same period the Company's share price has declined by over 14% from $62.23 to $53.38. In our view, the actions taken to date have not adequately addressed a number of significant issues facing the Company, including (i) continuing consolidation among traditional sources of print advertising revenue; (ii) the redirection of advertising dollars to other media; (iii) the Company's unexceptional operating margins; and (iv) the Company's lack of a nationally read paper capable of being leveraged in the online market. In light of these and other factors, we view the best interests of the shareholders as being served by the Board soliciting competitive bids for the Company, either from financial buyers willing to pay fair value or industry participants that would realize synergies and increased market presence through the acquisition of Knight Ridder's highly desirable local newspaper and online advertising assets. We understand through publicly available material that Company management has, on several occasions, determined the Company's break up value to be substantially in excess of the current share price. While we are not putting a specific break up or fair market value on the Company's assets at this time, based on what we observed of other shareholders invited to address the Board at its July meeting, we think that we are not alone in believing that the Company's fair value significantly exceeds its current share price. In the present environment, even considering management's incremental efforts and the Company's top tier assets, the market has persistently failed to recognize the fair value of the Company as it is currently configured and managed. Accordingly, we are calling on the Board to initiate a process to seek competitive offers for the Company and to allow the Company's shareholders to determine whether resulting bids adequately reflect the fair value of the Company's assets. We anticipate that other shareholders would strongly support the Board's efforts to auction the Company at this time. In the absence of such action by the Board, PCM would strongly consider supporting more aggressive efforts that might be initiated by other parties seeking to change the composition of the Board, install new management, acquire a majority of the Company's voting shares, or take other action to maximize shareholder value. As long term supporters of the Company, we thank you for your prompt and thoughtful consideration of this matter. Sincerely, /s/ Bruce S. Sherman Bruce S. Sherman Chief Executive Officer cc: Mr. Tony Ridder -----END PRIVACY-ENHANCED MESSAGE-----