Gannett announced the total deal valued of $815 million including the assumption of Tribune’s debt. Gannett wants Tribune so that it can expand its USA Today Network, an effort it launched late a year ago to unite its national brand USA Today with its more than 100 local daily newspapers. But Gannett said Monday that Tribune has refused to start “constructive discussions” about a deal since it first offered to buy its rival earlier this month. Tribune now owns the Los Angeles Times, the Chicago Tribune and nine other dailies.
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Tribune Publishing Co. has received an unsolicited proposal, with numerous contingencies, from Gannett Co., Inc. on April 12, 2016 to acquire all outstanding shares of Tribune Publishing for approximately US$388.3 million. “The board is committed to acting in the best interests of shareholders and will respond to Gannett as quickly as feasible”, the company wrote in a news release.
“Tribune in some degree has been in disarray with the recent management changes and the company has been slow to implement its digital strategy”, Michael Kupinski, an analyst at Noble Financial Capital Markets told Reuters news agency.
“Given the opportunity to benefit from the significant premium and near-term liquidity, we are confident that Tribune’s stockholders will embrace our offer”, said Robert Dickey, the president and chief executive of Gannett in the newly disclosed letter. Tribune, which brands include the Los Angeles Times and the Chicago Tribune, said that while it will review Gannett’s proposal, it believes the transformation it has undertaken this year put its in position to create value for shareholders. Tribune’s response to the takeover offer is “more of a maybe than a declaration of intent to fight”, Poynter said.
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Gannet Co shares were up $0.96, or 6%, to $16.73 by early afternoon.
