The expanded McClatchy Company will have 32 daily newspapers and approximately 50 non-dailies after the planned sale of 12 Knight Ridder papers. McClatchy's dailies will then have a combined daily circulation of about 3.2 million, making it the nation's second largest newspaper company measured by daily circulation. McClatchy stated that it would have had 2005 pro forma revenues of $2.83 billion and combined pro forma EBITDA of $754 million assuming full year ownership of all retained papers, after planned divestitures which contribute $219 million of EBITDA, and before cost synergies. The transaction is expected to be accretive to free cash flow (net income after adding back depreciation and amortization, minus capital expenditures) in the mid-teens percent and dilutive to GAAP earnings per share in the mid-single digit range in the first year after closing, becoming EPS accretive by 2008.

As a result, McClatchy will own leading newspapers in many of the fastest growing markets nationwide. Papers to be added through this transaction include the Miami Herald, Kansas City Star, Fort Worth Star-Telegram and Charlotte Observer. They will join McClatchy's 12 papers serving cities like Minneapolis, MN; Sacramento, CA; and Raleigh, NC. In addition, McClatchy combined with Knight Ridder will have an expanded network of valuable internet assets including the national Real Cities network, a one-third stake in the leading jobs site CareerBuilder, and other attractive interactive businesses.

INFO SOURCES

The McClatchy Company (NYSE: MNI) of Sacramento, CA and Knight-Ridder, Inc. (NYSE: KRI)

ADVISORS

Credit Suisse served as financial advisor to McClatchy and Goldman, Sachs & Co. and Morgan Stanley advised Knight Ridder in connection with this transaction. Wilson Sonsini Goodrich & Rosati served as legal counsel to McClatchy and Wachtell, Lipton, Rosen & Katz, and Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel to Knight Ridder.

TRANSACTION

Shareholders of Knight Ridder will receive $40.00 in cash and a fixed fraction of .5118 of a share of McClatchy Class A stock for a total per share consideration of $67.25 based upon the closing price for McClatchy on March 10, 2006 of $53.24. At the transaction's closing, McClatchy will have approximately 54.9 million Class A shares outstanding and 26.2 million Class B shares. The transaction is subject to customary terms and conditions, including approval by the Knight Ridder shareholders and is expected to close in three to four months. Holders of McClatchy Class B stock acting by written consent have adopted the merger agreement, approved the issuance of the shares in the merger and approved an amendment to McClatchy's restated certificate of incorporation to increase the authorized Class A common stock from 100 million shares to 200 million shares in connection with the merger. No further vote of McClatchy's stockholders is required.

McClatchy will finance the transaction with a $3.75 billion bank debt facility. It has received commitments from Bank of America, N.A. and JPMorgan Chase Bank, N.A. to underwrite the financing for the purchase.

McClatchy intends to divest 12 Knight Ridder newspapers, mainly located in cities that do not fit the company's longstanding acquisition criteria, chiefly involving growing markets. The largest are the Philadelphia Inquirer and San Jose Mercury News. Others include Knight Ridder's other Philadelphia paper, the Daily News; Akron Beacon Journal (OH); Wilkes Barre Times Leader (PA); Aberdeen American News (SD); Grand Forks Herald (ND); Ft. Wayne News - Sentinel (IN); Contra Costa Times (CA); Monterey Herald (CA); and Duluth News Tribune (MN). The St. Paul Pioneer Press (MN) is to be sold due to anticipated anti-trust concerns involving McClatchy's (Minneapolis) Star Tribune.

BOARD / MANAGEMENT

McClatchy will add two Knight Ridder directors to its board.

FIRMS

The McClatchy Company, headquartered in Sacramento, CA, is a leading newspaper and internet publisher. It publishes 12 daily and 17 non-daily newspapers located in western coastal states, North and South Carolina, and the Twin Cities of Minneapolis/St. Paul. McClatchy has daily circulation of 1.4 million and Sunday circulation of 1.8 million. McClatchy's newspapers include, among others, the Star Tribune in Minneapolis, the Sacramento Bee, the Fresno Bee and the Modesto Bee in California, the News & Observer (Raleigh, NC), the News Tribune (Tacoma, WA), the Anchorage Daily News and Vida en el Valle, a bilingual Spanish weekly newspaper distributed throughout California's Central Valley. McClatchy also operates leading local websites in each of its daily newspaper markets, offering readers information, comprehensive news, advertising, e-commerce and other services, and owns and operates McClatchy Interactive, an interactive operation that provides websites with content, publishing tools and software development. McClatchy is listed on the New York Stock Exchange under the symbol (MNI).

Knight Ridder is one of the nation's leading providers of news, information and advertising, in print and online. The company publishes 32 daily newspapers in 29 U.S. markets, with a readership of 8.5 million daily and 11.0 million Sunday. It has Web sites in all of its markets and a variety of investments in internet and technology companies. It publishes a growing portfolio of targeted publications and maintains investments in two newsprint companies. The company's internet operation, Knight Ridder Digital, develops and manages the company's online properties. It is the founder and operator of Real Cities (http://www.RealCities.com), the largest national network of city and regional web sites in more than 110 U.S. markets. Knight Ridder and Knight Ridder Digital are headquartered in San Jose, CA.

ACQUISITION HISTORY - The McClatchy Company

The company first moved beyond its California base by acquiring The Anchorage Daily News in 1979. It later added the News Tribune (Tacoma) in 1986; the News & Observer (Raleigh) in 1995; the Star Tribune (Minneapolis) in 1998; and Sun Star (Merced, CA) in 2004.