Gannett will urge shareholders of Tribune Publishing to withhold their votes for all eight nominees to Tribune's board, escalating its takeover fight in a quest to gain bigger regional newspapers such as the Los Angeles Times and the Chicago Tribune.
The publisher of USA Today went public last week with an $815 million buyout offer for Tribune after unsuccessfully making a private bid.
Tribune has hired Goldman Sachs Group and Lazard as financial advisers and Kirkland and Ellis LLP as a legal adviser to consider Gannett's $12.25-per-share offer – a 63 per cent premium to Tribune's closing price on April 22nd.
“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 chief executive Robert Dickey said in a statement on Monday.
Shareholders will vote at Tribune’s annual meeting on June 2nd.The move increases the pressure on leading Tribune shareholder Michael Ferro to make a deal just three months after he became nonexecutive chairman.
While Tribune isn’t opposed to working with Gannett on a deal, according to people close to Tribune, Mr Ferro has shown an unwillingness to sell.
The entrepreneur last week said Gannett was "trying to steal the company" by pressing for acceptance of its offer before the board could review his strategy for the company and before the June 2nd 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. With a deal, Gannett would have a 17 per cent share of the total daily newspaper circulation of about 41 million, according to Bloomberg Intelligence.
Currently, Gannett has about a 12 per cent share, while Tribune has 5 per cent with papers including the Chicago Tribune and Baltimore Sun, as well as the LA Times.