JimmyCsays: At the juncture of journalism and daily life in KC

The company that is poised to take control of McClatchy and its 29 daily papers doesn’t have a website.

The company’s C.E.O., Anthony Melchiorre, doesn’t give interviews, and no photo of him is available online.

The company’s main office is on the second floor of a nondescript, two-story office building in Chatham, NJ, 28 miles west of the Manhattan skyscrapers.

Why so hush-hush and such a low profile?

Well, this company, Chatham Asset Management, doesn’t do a lot that would make it want to call attention to itself. It doesn’t produce a product or render a significant service to society. It doesn’t employ a lot of people, and I doubt if it sponsors arts organizations and gives to charities in Chatham. What it does, apparently, is make its clients lots of money.

Chatham is a hedge fund, and, like most hedge funds, it is interested in just one thing: Big bucks.

The New Jersey office building in which Chatham Asset Management has its office

Many hedge funds look to acquire companies that, while they may be failing, still generate a lot of cash. After sinking their claws into such companies, they suck out the cash and invest the money elsewhere, where they can get better, surer returns.

Over time, Chatham has increased its investment (and sunk its teeth?) in McClatchy, to the point where it became not only the company’s largest shareholder but also its biggest creditor.

Chatham had waited patiently for Thursday, and now it’s in the catbird seat, waiting for the Chapter 11 bankruptcy proceedings to play out and then take charge.

This is all very bad news for The Kansas City Star and the other McClatchy papers. As weak as these papers are and as far as they have fallen, they still throw off lots of cash. In that sense, they are perfect victims for scavengers.

For the sake of McClatchy’s approximately 2,800 employees (for comparison’s sake, The Star alone had more than 2,000 employees about 20 years ago), I’m sorry to say things could get a lot worse before there’s any chance of getting better.

I can almost guarantee you there will be staff cuts at most or all of those newspapers. Any McClatchy employees hoping that Chatham might not be as bad as the hedge fund Alden Global Capital, which has decimated the Denver Post and other papers in its stranglehold, should consider this: Chatham is the majority owner of American Media, which owns the tabloid National Enquirer — which hardly recommends Chatham as a potential restorer of the 29-paper chain to the newspaper industry’s top ranks.

Like Warren Buffett, Wall Street traders and just about everyone else, Chatham has no illusions about where the newspaper industry is headed; it just wants to bleed them of cash, or, perhaps, sell them at a nice profit to another chain.

The guy who will be drawing the blood, Anthony Melchiorre, apparently is a piece of work.

A March 2019 Fortune magazine story said Melchiorre, who is either 51 or 52, was raised in Chicago, studied economics at Northwestern and got an MBA from the University of Chicago. After working at investment banking firms Donaldson, Lufkin & Jenrette and Goldman Sachs, he went to Morgan Stanley in 1998, where he worked his way up to heading the firm’s junk-bond trading group.

Fortune said Melchiorre wasn’t a particularly good fit at the firm and irritated some senior executives.

“Although not physically imposing,” the Fortune story said, “Melchiorre could be foul-mouthed and loud, and would berate fellow traders as he bopped around the trading floor in his stocking feet.”

Indications are he’s been with Chatham more than 15 years.

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In the newspaper industry, it is typical after an ownership change for the C.E.O. of the acquiring company to visit the newsrooms of the papers being bought and to speak about the company’s plans for the future and answer employees’ questions.

When Walt Disney Co. bought The Star and its parent company, Capital Cities/ABC, in 1995, Disney C.E.O. Michael Eisner came to the newsroom. (The most memorable thing he said was Disney would not be selling the papers anytime soon, but they were on the block a year later.)

When Knight Ridder bought The Star and three other Disney-owned papers in 1997, I’m pretty sure Knight Ridder C.E.O. Tony Ridder came to the newsroom and spoke, although he was such a stone of a personality I don’t specifically remember it.

And in 2006, when McClatchy bought out Knight Ridder, McClatchy C.E.O. Gary Pruitt came to the newsroom. I remember that very well because by then I was hoping for a buyout and asked him, in front of the crowd, if he was planning on offering any. (The answer was no, and I retired on June 30, three days after the McClatchy deal closed.)

But Melchiorre? No, I don’t think he’ll be visiting the newsroom and talking about Chatham’s plans for the paper. I would bet, in fact, that not one Star employee — not even president-publisher-secretary and head of security Mike Fannin — will ever see him.

But just on the outside chance he does come around, would somebody please take his picture and send it to me?