Large Sun-Times investor calls for change

WASHINGTON -- The second-largest shareholder of Sun-Times Media Group Inc. criticized the company's performance in a letter Tuesday and called for operational changes at the publisher of the Chicago Sun-Times newspaper.

K Capital Partners LLC, which owns 9.8 percent of the Sun-Times Media Group, said it has been extremely disappointed with the performance of the company over the past year, according to the letter disclosed in a filing with the Securities and Exchange Commission.

K Capital urged the company to develop a detailed 2008 operating plan with clear targets and release the key points of this plan to investors by Jan. 15, via a press release and a conference call.

K Capital suggested that Sun-Times should compensate executives and directors entirely in equity compensation and the level of such compensation for 2008 should not exceed the level for 2007.

K Capital also urged Sun-Times to immediately finish its previous share repurchase program "to take advantage of the extreme undervaluation of the current stock price."

Shares of Sun-Times Media fell 5 cents, or 4.3 percent, to close at $1.10 Tuesday.

The stock has declined roughly 77 percent this year.