Exclusive: Tribune Publishing to reject Gannett offer, will share info - sources
By Greg Roumeliotis and Liana B. Baker
(Reuters) - Tribune Publishing Co TPUB.N has decided to reject Gannett Co Inc's (GCI.N: Quote) latest $864 million takeover proposal, but will agree to share confidential information with the U.S. newspaper company, people familiar with the matter said on Sunday.
The move offers a path for Gannett, owner of USA Today, and Tribune Publishing, which owns a stable of newspapers including the Los Angeles Times and the Chicago Tribune, to engage in negotiations following a bitter dispute.
Last week, Gannett asked Tribune Publishing shareholders to withhold support for the latter's eight nominees to the board of directors at Tribune Publishing’s annual meeting on June 2.
While Tribune Publishing considers Gannett's $15 per share cash offer to be inadequate, it will offer Gannett access to some of its confidential corporate information under a non-disclosure agreement, the people said.
There is no certainty that Gannett will use this opportunity to table a higher offer, the people cautioned, asking not to be identified because the deliberations are confidential.
Tribune and Gannett representatives could not immediately be reached for comment.
Gannett's pursuit of Tribune has come at a challenging time for the newspaper industry, which is grappling with high costs, shrinking advertising dollars and a broad move toward digital content. Gannett is betting that bigger scale will bring it savings and help it generate more profit.
With Tribune Publishing now an acquisition target, it remains to be seen whether other companies in the sector, such as New Media Investment Group Inc NEWM.N, News Corp (NWSA.O: Quote) and McClatchy Co (MNI.N: Quote), will show an interest. Continued...