Big changes are afoot at Tribune Publishing, but it’s not clear what they’ll be after the owner of the Los Angeles Times formally rejected Gannett’s $400 million acquisition offer.

In a letter to Gannett, Tribune CEO Justin Dearborn called the proposal “opportunistic” and “not a basis for further discussion.”

Tribune disclosed its letter just as it released Q1 earnings that fell short of Wall Street expectations. The company recorded a net loss of $6.46 million, down from last year’s profit of $2.52 million, with revenues flat at $398.2 million.

But Dearborn says the company is “at the very early stages of executing our clear plan to transform Tribune Publishing by increasing monetization of our important brands, capitalizing on the global potential of the LA Times, and significantly accelerating our conversion of content to revenue through an enhanced digital strategy. As we execute our plan, we are confident in our ability to deliver value for our shareholders.”

The USA Today owner’s $12.25-a-share bid represented a nearly 63% premium to Tribune’s trading price before the offer was made public.

In a call with analysts, Tribune said it wouldn’t answer questions about the Gannett initiative. Yet Dearborn called it “an unfortunate distraction” for his employees, adding that the board seriously considered the proposal before rejecting it.

Tribune says it has a more lucrative opportunity by accelerating its transition to digital distribution and sales at publications including the Chicago Tribune, Baltimore Sun, and The Hartford Courant.

He also hopes to make L.A. Times a “global revenue generator.” Those plans include opening bureaus this year in Hong Kong, Seoul, Mexico City, Moscow, Rio de Janeiro, Lagos and Mumbai.

“Each of these cities represent vibrant, entertainment-heavy cultures,” Dearborn says.

In response, Gannett says if its $12.25 offer is too low, then Tribune should explain why in February it issued stock to tech executive Michael Ferro at $8.50 per share. That made him Tribune’s largest shareholder and enabled him to install Dearborn, an associate, as CEO, replacing Jack Griffin.

Gannett is encouraging Tribune shareholders to register their support for a deal by withholding their votes for company directors at the June 2 annual meeting.

“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,” Gannett Chairman John Jeffry Louis says. The board and management “are ready to negotiate a transaction with Tribune and committed to making this a reality.”

The net effect: Tribune shares were up 4.4% in postmarket trading. It’s not clear whether investors like Tribune’s plan or feel that its Q1 loss will make it harder for the company to continue to resist Gannett.