Gannett said to boost Tronc bid
The company’s latest bid for the L.A. Times owner is undisclosed, according to reports.
The publisher is reportedly back with an increased offer for the newspaper chain that includes the Los Angeles Times.
Three months after its last offer was spurned, Gannett Co. is reportedly back with an increased bid to buy Tronc Inc., the newspaper chain formerly known as Tribune Publishing, which owns the Los Angeles Times.
Gannett left its rejected $15-a-share bid on the table since May, waiting for Tronc’s second-quarter earnings, released Aug. 3.
Industry sources said last week that Gannett was conducting due diligence on Chicago-based Tronc in preparation for another potential offer.
News of Gannett’s new bid for an undisclosed price was first reported Wednesday by the Wall Street Journal, citing unnamed sources familiar with the situation.
Tronc spokeswoman Dana Meyer declined to comment Thursday, as did Gannett spokesman Nick Lamplough.
Tronc shares jumped 67 cents, or 4.4%, to $15.95 on Thursday. Gannett shares edged up 1 cent, or about 0.1%, to $12.14.
The previous $15-a-share bid by Gannett, the McLean, Va., publisher of USA Today and more than 100 other newspapers, valued Tronc at $864 million, including debt.
Tronc Chairman Michael Ferro and the board rejected that offer, saying their plan for leveraging the digital assets of the legacy newspaper chain would bring more value to shareholders.
Tronc has rebuffed Gannett since an unsolicited $12.25-a-share offer was made public in April, adopting a “poison pill” approach to prevent a tender offer and force negotiations to run through the board.
Since then, shareholders have increased pressure on Tronc to negotiate with Gannett, with several lawsuits filed and a larger one looming. In June, investment firm Oaktree Capital Management, which owns roughly 13% of Tronc’s shares, requested records to determine whether to initiate a shareholder derivative suit.
In addition to the Los Angeles Times, Tronc owns 10 major daily newspapers, including the Chicago Tribune. The company spun off from Tribune Media Co. in August 2014.
Ferro, a technology entrepreneur who previously owned the Chicago Sun-Times, became chairman of Tronc and its largest shareholder when his investment firm bought a 16.6% stake in February, a $44.4million deal that priced the stock at $8.50 a share.
In June, Tribune Publishing was renamed Tronc — short for Tribune online content, the company’s digital strategy — and its stock was moved from the New York Stock Exchange to Nasdaq.