- Board's lack of engagement `unacceptable,' CEO Dickey says
- Tribune sees `opportunistic attempt to steal the company'
Gannett Co. will urge shareholders of Tribune Publishing Co. to withhold their votes for all eight nominees to Tribune’s board, escalating its takeover fight to acquire the owner of big regional newspapers like the Los Angeles Times.
The publisher of USA Today went public last week with an $815 million buyout offer after unsuccessfully making a private bid. Tribune has hired Goldman Sachs Group Inc. and Lazard as financial advisers and Kirkland & Ellis LLP as a legal adviser to consider the $12.25-per-share offer -- a 63 percent premium to Tribune’s closing price on April 22.
“We intend to give Tribune stockholders the opportunity to send a clear message to the Tribune board that its lack of engagement with our board and management team regarding our highly compelling, premium offer for $12.25 per share in cash is unacceptable,” Gannett CEO Robert Dickey said in a statement Monday. Shareholders will vote at Tribune’s annual meeting on June 2.
The move increases pressure on top Tribune shareholder Michael Ferro to make a deal just three months after he became nonexecutive chairman. The entrepreneur last week said Gannett was “trying to steal the company” by pressing for acceptance of its offer before the board can review his strategy for the company and before June 2 shareholder meeting, Los Angeles Times columnist Michael Hiltzik reported.
Gannett has also submitted a request for Tribune’s shareholder records so it can communicate directly with investors.
In an e-mail responding to a request for comment, Dana Meyer, a Tribune spokeswoman, said Gannett’s suggestion that the board hasn’t taken the proposal seriously is “misleading and disingenuous.”
“We regularly engage with all of our shareholders, including our largest shareholders who own over 40 percent of the company, and we are confident that the nominees to the board, who are unopposed, will earn the plurality of votes necessary to be elected,” Meyer said.
Gannett’s tactics show a “desperate and opportunistic attempt to steal the company,” Meyer added.
With a deal, Gannett would have a 17 percent share of total daily newspaper circulation of around 41 million, according to Bloomberg Intelligence. Currently, Gannett has about a 12 percent share, while Tribune has 5 percent with papers including Chicago Tribune and Baltimore Sun, as well as the Times.
Tribune will share its strategy and the various possibilities for the company on an earnings call May 4, Meyer said. The board will announce the results of its advisers’ review “as soon as feasible,” she said.