0001104659-05-052204.txt : 20051103 0001104659-05-052204.hdr.sgml : 20051103 20051103114530 ACCESSION NUMBER: 0001104659-05-052204 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20051103 DATE AS OF CHANGE: 20051103 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 SEC ACT: 1934 Act SEC FILE NUMBER: 005-16367 FILM NUMBER: 051175788 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: HARRIS ASSOCIATES L P CENTRAL INDEX KEY: 0000813917 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 043276558 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 2 NORTH LASALLE STREET STREET 2: SUITE 500 CITY: CHICAGO STATE: IL ZIP: 60602-3790 BUSINESS PHONE: 312-621-0600 MAIL ADDRESS: STREET 1: 2 NORTH LASALLE STREET STREET 2: SUITE 500 CITY: CHICAGO STATE: IL ZIP: 60602-3790 SC 13D 1 a05-19592_1sc13d.htm BENEFICIAL OWNERSHIP OF 5% OR MORE

	UNITED STATES	OMB APPROVAL
	SECURITIES AND EXCHANGE COMMISSION	OMB Number: 3235-0145
	Washington, D.C. 20549	Expires: December 31, 2005
	SCHEDULE 13D	Estimated average burden hours per response. . 15

Under the Securities Exchange Act of 1934
(Amendment No. )*

KNIGHT-RIDDER, INC.

(Name of Issuer)

Common Stock, par value $0.02 1/12 per share

(Title of Class of Securities)

499040103

(CUSIP Number)

Janet L. Reali
Harris Associates L.P.
Two North LaSalle Street
Suite 500
Chicago, IL 60602

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

November 3, 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. ý

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

^* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No. 499040103

	1.	Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Harris Associates, L.P. 04-3276558

	2.	Check the Appropriate Box if a Member of a Group (See Instructions)
		(a)			o
		(b)			ý

	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) o

	6.	Citizenship or Place of Organization Delaware

Number of Shares Beneficially Owned by Each Reporting Person With			7.	Sole Voting Power 0

			8.	Shared Voting Power 5,463,295 (Estimated as of 11/2/2005)

			9.	Sole Dispositive Power 1,984,428

			10.	Shared Dispositive Power 3,522,500

	11.	Aggregate Amount Beneficially Owned by Each Reporting Person 5,506,928

	12.	Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) o

	13.	Percent of Class Represented by Amount in Row (11) 8.15%

	14.	Type of Reporting Person (See Instructions) IA

Item 1.	Security and Issuer
This Schedule 13D relates to the common stock, par value $0.02 1/12 per share (the “Common Stock”), of Knight-Ridder, Inc., a Florida corporation (the “Issuer”), and the principal executive offices of the Issuer are located at 50 West San Fernando Street, Suite 1500, San Jose, CA 95113. The Common Stock is traded on the New York Stock Exchange.

Item 2.	Identity and Background
(a) Name. The person filing this Schedule 13D is Harris Associates L.P. (“HALP”). HALP is also referred to as the “Reporting Person.” HALP exercises sole or shared dispositive power and shared voting power with respect to the Issuer’s shares of Common Stock held by HALP on behalf of its clients. Such voting authority may be withdrawn by HALP clients at any time. HALP disclaims that it is a member of any Group, as defined in Rule 13d-5(b)(1). HALP’s general partner is Harris Associates, Inc., a Delaware corporation, which is wholly-owned by IXIS Asset Management Holdings, LLC (“IXIS”). HALP disclaims that IXIS beneficially holds any of the Issuer’s shares of Common Stock held by HALP on behalf of HALP’s clients. (b) Business Address. Harris Associates L.P., Two North LaSalle Street, Suite 500, Chicago, IL 60602 (c) Principal Occupation. HALP is a registered investment adviser under the Investment Advisers Act of 1940. HALP has the power and authority to make decisions to buy and sell securities on behalf of its clients. (d) The Reporting Person has not, during the last five years, been convicted in any criminal proceedings. (e) The Reporting Person has not, during the last five years, been a party to a civil proceeding of any judicial or administrative body of competent jurisdiction as a result of which such person was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or a finding of any violation with respect to such laws. (f) HALP is a limited partnership organized under the laws of the state of Delaware.

Item 3.	Source and Amount of Funds or Other Consideration
HALP has acquired on behalf of its clients 5,506,928 shares of Common Stock at an aggregate purchase price of $285,361,447.57. Funds for these purchases were derived from HALP clients.

Item 4.	Purpose of Transaction
Upon reviewing the recent Form 13D filing of the Issuer’s largest shareholder, HALP, as is its practice, evaluated its position with respect to the Issuer’s Common Stock. As another significant shareholder of the Issuer, HALP determined that it was appropriate to provide its current views through this filing. In making this filing, HALP is acting on its own accord on behalf of its clients and not in concert with any other investor or as a part of any group. HALP purchased the shares of Common Stock of the Issuer on behalf of its clients for investment

purposes. On July 19, 2005, at the invitation of the Issuer’s Chairman and CEO, representatives of HALP addressed the Issuer’s Board of Directors and expressed HALP’s concerns over the performance of the Issuer and the Issuer’s Common Stock. Since that time, in HALP’s view, the discrepancy between the Issuer’s intrinsic value and the price of its Common Stock has not diminished. For the reasons stated in HALP’s letter to the Issuer’s Board of Directors, dated November 3, 2005, a copy of which is attached as an exhibit to this filing, HALP requests that the Issuer’s management and Board promptly pursue a competitive sale of the Issuer. HALP reserves the right to support efforts that might be initiated by other parties seeking to acquire a majority of the Issuer’s voting shares, or to initiate action or support efforts initiated by other parties to change the composition of the Board, install new management, or take other action to maximize shareholder value. HALP’s representatives may, as they have done in the past, discuss with management, the Board and others HALP’s concerns over what it believes to be a discrepancy between the Issuer’s intrinsic value and the price of its Common Stock. Depending on HALP’s assessment of future developments, it may acquire additional Issuer securities on behalf of its clients or may determine to sell or otherwise dispose of all or some holdings in the Issuer or take any other action it deems to be in its clients’ best interest. Except as set forth herein and in the letter to the Issuer’s Board, dated November 3, 2005 and attached as an exhibit hereto, HALP has no present plans or proposals that would result in or relate to any of the transactions or changes listed in Items 4(a) through 4(j) of Schedule 13D.

Item 5.	Interest in Securities of the Issuer

(a)

	Number of	Percentage
Reporting Person	Shares	of Shares
Harris Associates L.P.	5,506,928	8.15	%
	(Estimated as of 11/2/2005)

(b) HALP currently exercises voting authority over shares of Common Stock held in the accounts of its clients that have delegated proxy voting authority to HALP. Such voting authority may be withdrawn by HALP clients at any time.

Sole power to vote or direct the vote: 0

Shared power to vote or direct the vote: 5,463,295 (Estimated as of 11/2/2005)

Sole power to dispose or to direct the disposition: 1,984,428

Shared power to dispose or direct the disposition: 3,522,500

(c) The following table sets forth the transactions effected by HALP on behalf of clients in the shares of Common Stock during the last 60 days:

	Number of	Average		Transaction
Date	Shares	Price Per Share		Effected

9/13/05	300	$	62.06	Open Market Sale
9/14/05	100	$	60.20	Open Market Sale
9/21/05	200	$	58.77	Open Market Sale
9/21/05	300	$	58.94	Open Market Sale
9/21/05	200	$	58.67	Open Market Sale
9/23/05	300	$	55.98	Open Market Sale
9/26/05	1,500	$	55.85	Open Market Sale
9/30/05	400	$	57.90	Open Market Sale
10/18/05	12,600	$	54.13	Open Market Sale
10/21/05	1,300	$	52.64	Open Market Sale
10/24/05	1,700	$	53.63	Open Market Sale
10/26/05	300	$	53.99	Open Market Sale

(d) HALP, an investment advisor registered under the Investment Advisors Act of 1940, pursuant to investment advisory contracts with its clients, has sole or shared dispositive power over the shares of Common Stock in the HALP investment advisory accounts of clients. The individual clients, none of which 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 Common Stock. (e) Not applicable.

Item 6.	Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer
None.

Item 7.	Material to Be Filed as Exhibits
	99.1. Letter to the Board of Directors of Knight-Ridder, Inc., dated November 3, 2005

Signature

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.

HARRIS ASSOCIATES L.P.	November 3, 2005
	Date
	/s/ Janet L. Reali
	Signature
	Janet L. Reali, General Counsel
	Name/Title

EX-99.1 2 a05-19592_1ex99d1.htm LETTER TO BOARD OF DIRECTORS

Exhibit 99.1

November 3, 2005

Board of Directors

Knight-Ridder, Inc.

c/o Mr. Anthony Ridder, Chairman

50 West San Fernando Street, Suite 1500

San Jose, CA 95113

Dear Board Members:

After reading the letter you received earlier this week from Private Capital Management, L.P., which was made public in a Form 13D filing, we felt it was appropriate to communicate to you the views of Harris Associates L.P. (“HALP”). HALP, on behalf of its clients, has been a significant shareholder of Knight-Ridder (“Knight-Ridder” or “the Company”) for over a decade, and HALP, on behalf of its clients, now holds approximately 8.15% of the Company’s outstanding shares. HALP has frequently called to the attention of Knight-Ridder’s management the persistent and significant gap between what HALP believes to be the Company’s intrinsic value and the trading price of its stock. On July 19, 2005, we were given an opportunity to address the Company’s Board on behalf of HALP, and expressed our views that the Board should consider various alternatives to maximize value. HALP now urges the Board of Directors to solicit offers for the Company to maximize the value of Knight-Ridder for its shareholders. As discussed below, HALP believes an acquisition of the Company would result in a price to shareholders substantially above the Company’s current market value.

Private market transactions in the newspaper industry consistently have taken place at higher multiples of cash flow than the public market has been willing to assign to the Company. Moreover, although operating margins at Knight-Ridder have improved since HALP first initiated its investment, current management has failed to achieve results consistent with the leaders in the newspaper industry. Given the failure to achieve desired operating results, the large gap between the stock price and a price implied by industry acquisition benchmarks, and the ready availability of acquisition capital, we believe now is an opportune time to pursue a sale of the Company. We further believe the owners of Knight-Ridder, not a management with minimal ownership in the Company, should have the opportunity to determine whether or not acquisition offers reflect fair value of the Company.

HALP believes that the paramount responsibility of any board and management is to maximize the present value of its stock price. HALP now believes that it is unlikely that Knight-Ridder can achieve that goal as an independent public company. HALP believes that its clients, together with other owners of the Company, deserve the opportunity to obtain fair value for their shares through an open auction of Knight-Ridder, and we urge the board to begin this process immediately.

Sincerely,

William C. Nygren		Henry R. Berghoef
Portfolio Manager		Vice President, Director of Research
		and Portfolio Manager

Under the Securities Exchange Act of 1934 (Amendment No. )*

Signature

Under the Securities Exchange Act of 1934
(Amendment No. )*