Knight Ridder gets look from new suitors

As Knight Ridder Inc. begins meeting with potential buyers this week, new names are emerging as contenders for the country's number two newspaper chain.

At least three previously undisclosed private-equity companies have joined groups interested in acquiring the publisher of The San Jose Mercury News, Philadelphia Inquirer, and 30 other newspapers.

In addition, both the union representing thousands of Knight Ridder employees and some of the chain's top executives are trying to find financial partners for their own bids, participants in the auction said Tuesday.

Two of the previously undisclosed private equity companies, Bain Capital and Hellman & Friedman, have teamed with Thomas H. Lee Partners and Texas Pacific Group in one coalition, said two people involved in the process.

In addition, people involved in the auction said, Vestar Capital Partners has joined forces with Madison Dearborn Partners, which had been identified as a bidder earlier.

Those coalitions are vying against at least one other previously reported combination: investment companies Kohlberg Kravis Roberts & Co., Blackstone Group, and Providence Equity Partners.

None of the companies involved would comment, and a Knight Ridder spokesman didn't return a phone call.

Many of the private-equity businesses, which use money from institutions and wealthy individuals to make equity investments, have worked together in the past, some of them on media deals. Their interest in Knight Ridder is a good sign for Knight Ridder investors and newspapers in general, which have been battered by concerns about competition from the Internet.