Going private isn’t a form of immunity: Avista, the PE-fund that bought the Minneapolis Star-Tribune for $530 million in late 2006, has written down 75 percent of its original investment. The leverage fund only put up $100 million of its own cash, with the rest coming form financiers. A letter to the fund’s investors, excerpted by the paper, sings a familiar song: “In the past year, the newspaper industry has suffered greater than expected declines in circulation and advertising revenue, particularly in print classified advertising.” The letter also denied a NYP report saying the entity was on the brink of bankruptcy, though the firm has hired Blackstone to help it deal with its financial issues.

Basically, the company’s losses are in range with what’s been seen elsewhere: McClatchy (NYSE: MNI) shares are down over 60 percent since the end of 2006. Journal Communications (NYSE: JRN) are down by over 50 percent. So, anyone want to step up and catch a falling knife?

• Star Tribune Newspaper Sold by McClatchy To PE Firm For $530 Million