'USA Today' Publisher Gannett Makes Unsolicited Bid for Tribune
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Gannett Co. Inc., the publisher of USA Today, said it offered to buy Tribune Publishing Co. but the owner of the Los Angeles Times refused to begin "constructive" talks.
"We therefore are prepared to consider all alternatives to complete this transaction," Gannett Chief Executive Robert Dickey said in a letter to Tribune Publishing's board.
Tribune Publishing, however, said in a statement that it had told Gannett it would engage financial and legal advisers to review the proposal and its "numerous contingencies."
Gannett said it made an offer to buy Tribune Publishing on April 12 for $815 million, including the assumption of $390 million of debt.
The offer of $12.25 per share represents a premium of about 63 percent to Tribune Publishing's Friday closing price $7.52. Tribune's Publishing's shares closed at $6.86 on April 11.
Tribune Publishing's shares, which have lost half of their value in the last nine months, jumped to $12.10 in premarket trading on Monday. Gannett's shares, which have gained 16 percent over the same period, were untraded.
"Continuing to refuse to engage in a dialogue with us will only serve to delay the ability of your stockholders to receive the value represented by our all-cash offer," Dickey said.
The offer comes at a time when the print industry is grappling with falling sales and circulation as more people get their news from digital medium.
Tribune Publishing reported a loss of $2.8 million in 2015 as revenue slipped 2.1 percent to $1.67 billion. Gannett posted a profit of $146.1 million, while revenue fell 9 percent to $2.89 billion.
Tribune Co. spun off its publishing assets into Tribune Publishing in 2014, and renamed the parent company, which houses its broadcasting and digital assets, Tribune Media Co.
(Reporting by Sai Sachin R and Supantha Mukherjee in Bengaluru; Editing by Saumyadeb Chakrabarty)