Gannett raises bid for Tribune
Company, which owns USA TODAY, offers $15 per share.
Gannett Co., which owns USA TODAY and more than 100 local news properties nationwide, said Monday it raised its offer to buy Tribune Publishing Co. to $15 per share, dialing up the pressure after its earlier bid was rejected by Tribune’s board of directors despite some shareholders’ call for a negotiation.
The revised offer values Tribune, which owns the Los Angeles Times, Chicago Tribune and nine other dailies, at about $479 million. Gannett also offered to assume about $385 million of Tribune’s debt, valuing the total deal at about $864 million.
Revised after Gannett met with Tribune shareholders, the heightened offer represents a premium of 99% to Tribune’s closing price of $7.52 per share on April 22, the last trading day before Gannett revealed its initial offer of $12.25.
Shares of Tribune Publishing rose 22.7% Monday to $14.08.
“After further review, we have greater confidence in our ability to yield additional operational improvements in this transaction,” Gannett’s CEO Robert Dickey wrote in a letter Monday to Tribune’s board. The McLean, Va.-based company also said it was confident it can receive the antitrust clearance necessary.
John Jeffry Louis, chairman of Gannett’s board, told USA TODAY he and Dickey met with Michael Ferro, Tribune’s board chairman, last week. But they “didn’t make any headway” about a negotiation, Louis said. “We certainly hope that (the new offer) will accelerate the process.”
In a statement, Tribune, headquartered in Chicago, said its board “will thoroughly review Gannett’s revised proposal.”
Seeking to acquire newspapers and affiliated digital news properties in markets where Gannett lacks a presence, Dickey sent a private letter April 12 — outlining his all-cash offer — to Ferro, the largest Tribune shareholder, and Justin Dearborn, Tribune’s CEO.
Unable to get a formal negotiation started, Gannett then revealed the offer publicly April 25, forcing Tribune to hire advisers to begin reviewing the bid. On May 4, Tribune’s board unanimously rejected the offer.
“We’re hearing from shareholders that they want a transaction to take place,” Dickey said. “We’re hopeful that (Monday’s) move to $15 shows shareholders that we’re serious.”