Selling Out in San Francisco   

Chronicle Publishing Co. has decided to put its holdings, including one of the country's last major family-owned papers, on the market.

With earthquakes and mud slides, San Franciscans are used to living in suspense. Recent developments at Chronicle Publishing Co. aren't exactly seismic in scale, but they've generated rumblings about the media company's decision to put its holdings, in- cluding one of the country's last major family-owned papers, on the market.
In June, Chronicle Publishing authorized New York investment bank Donaldson, Lufkin & Jenrette "to explore the sale of all or some of the company," according to a press release from Chronicle Publishing, which owns the San Francisco Chronicle.
Hearst, owner of the rival San Francisco Examiner, is considered the Chron's likely buyer. The morning Chronicle (circulation 475,244) and smaller afternoon Examiner (circulation 111,018) already share business operations and profits, based on a 34-year-old joint operating agreement up for a 10-year renewal in 2005. Under terms of the JOA, Hearst would have first right of refusal. Hearst officials in New York could not be reached for comment.
Other suitors reportedly are lining up for Chronicle Publishing's holdings, which include two more newspapers (the Telegram & Gazette in Worcester, Massachusetts, and the Pantagraph in Bloomington, Illinois); the NBC affiliate KRON in San Francisco and other TV stations in Wichita, Kansas, and Omaha, Nebraska; the local cable news operation BayTV; and book publishers Chronicle Books and MBI. The Chronicle reports that Gannett, Knight Ridder, Times Mirror, the New York Times Co., NBC, Fox Television, USA Network and Hicks Muse, a Dallas-based investment firm that owns numerous radio stations, have expressed interest in some properties. Neither Chronicle Publishing nor DL&J will confirm that report.
Chronicle Publishing is owned by the descendants of Michael de Young, who founded the Chronicle with his brother Charles in 1865. The board voted to put the diversified media company on the market because of "the hot economy, the Chronicle as an asset and the family's varied interests," says Don Solem of Solem & Associates, the San Francisco public relations firm representing the company.
Timothy O. White, the Examiner's editor and publisher since early this year, says that paper and its 210 newsroom employees for years have been buffeted by gossip that the Examiner would be sold, "so it feels good to be even rumored to be the acquirer rather than the acquiree."
And in the Chronicle newsroom, "nobody's panicked, by any means," says Executive Editor Matthew Wilson. The Chronicle has an editorial staff of about 370.
White says he wouldn't expect "any sort of cataclysmic change" if the newspapers' staffs were folded together. "A single paper would be huge and would need the overwhelming majority of the people we've got collectively...to forge ahead."
The timetable for action is uncertain. White, who admits he was "very surprised, startled even" by Chronicle Publishing's announcement, says "there seems to be some sense of urgency.... This could be concluded within calendar 1999, [though] that would be pretty fast for such a big undertaking."