LA Times owner rejects uninvited bid

Los Angles Times Image copyright Getty Images

The board at Tribune Publishing has unanimously rejected an unsolicited takeover offer from rival Gannett.

Gannett, the owner of USA Today, made an offer of $815m (£563m) last month.

Tribune, owner of the LA Times, told Gannett the "opportunistic proposal understates the company's true value and is not in the best interest of shareholders."

Gannett is fighting back, and wants Tribune shareholders to withhold their votes for board nominees on 2 June.

That is when Tribune will hold its annual meeting. Gannett hopes the move will send a "clear message" to Tribune's board that it should "substantively engage with Gannett regarding its proposal."

In response to the rejection, John Jeffry Louis, Chairman of the Gannett Board of Directors said, "It is unfortunate that Tribune's Board would deny their shareholders this compelling, immediate and certain cash value by rejecting our offer without making a counterproposal or otherwise negotiating or providing any constructive feedback."

Cash and debt

Gannett had offered to pay $12.25 per share in cash for Tribune as well as absorb $390m of Tribune's debt.

That offer represents a 63% premium to Tribune's closing stock price on 22 April, one day before Gannett announced its proposal.

Founded in New York, Gannett has been working to expand its ownership of regional US newspapers. Earlier this year, the publishing group acquired the Journal Media Group, owner of the Knoxville News Sentinel and the Milwaukee Journal Sentinel.

Tribune Publishing has its headquarters in Chicago and the media brand owns 11 major US newspapers including the Chicago Tribune, The Baltimore Sun and Hartford Courant.

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