Gannett had called on investors to withhold support for Tribune-backed
Washington - AFP
USA Today publisher Gannett said Thursday it was reconsidering its $864 million offer for rival newspaper group Tribune Publishing amid a heated war of words between the two media firms.
Gannett, which last month raised its offer for its rival -- owner of the Los Angeles Times and other large dailies -- suggested it may withdraw the bid after a Tribune Publishing shareholder meeting backed the company's plan to remain independent earlier in the day.
Gannett had called on investors to withhold support for Tribune-backed board members after management spurned the offer and criticized Gannett for undervaluing the company.
"Gannett is reviewing whether to proceed with its acquisition offer taking into account the results of the 'withhold' vote," a Gannett statement said.
The statement included comments from Gannett vice president Michael Dickerson, who sought to win over Tribune Publishing shareholders.
"We never intended to engage in a public fight for Tribune," Dickerson told Tribune shareholders.
"Instead we anticipated having constructive discussions with your board. However, rather than engaging with Gannett, the Tribune board has adopted an unproven strategy, implemented various delay tactics and ultimately effected a transaction that significantly diluted Tribune's outstanding shares."
Gannett's offer "would deliver superior and certain value for Tribune's owners at a tumultuous time for the company," he argued.
Gannett's bid aimed to combine the national daily USA Today with its rival's big regional newspapers such as the Chicago Tribune and The Baltimore Sun, in addition to the coveted Los Angeles Times daily.
After the bid became public, Tribune Publishing denounced Gannett's "hostile tactics," calling them part of an effort to "steal the company from our shareholders."
Tribune later adopted a "poison pill" share plan to make a takeover more complicated, adding a new investor as it pledged to continue efforts to remain independent and pursue its own path to adapt to the digital era.
In a statement after its shareholder meeting, Tribune Publishing announced it was "rebranding" by changing its name to "tronc."
The name, shortened from "tribune online content," according to a statement "captures the essence of the company's mission" to "deliver personalized and interactive experiences to its 60 million monthly users."
Separately, a Tribune Publishing shareholder filed suit accusing the company of breaching its fiduciary responsibility by rejecting the Gannett offer, the Chicago Tribune reported.
The suit by Capital Structures Realty Advisors says the company stacked its board and structured a new investment to fend off the takeover bid against shareholders' interests.
Tribune Publishing group was spun off the larger Tribune Co. in 2014, retaining the group's newspaper holdings.
Gannett also broke up its media conglomerate last year, splitting off its television operations into a new firm called Tegna.