The stock price for Los Angeles Times parent Tribune Publishing is up 1.5% to about $13.20 in pre-market trading this morning after Gannett said that it will keep its $864 million buyout offer in place.
The $15 a share bid will stand as the USA Today owner “evaluates various near-term developments, including the Tribune second quarter 2016 financial results, which are expected in August.”
Shares in Tribune — which plans to rename itself Tronc — rose 17.7% yesterday on reports that Gannett would stay in. Tribune has rejected the offer, saying that it can deliver more value via a plan to boost the L.A. Times and accelerate the company’s digital transition.
Gannett hoped to pressure Tribune Chairman Michael Ferro into negotiating. It urged shareholders to register their support by withholding their votes for the company’s directors at its annual meeting last week. Directors won a majority of the votes cast, but most independent owners withheld.
Gannett says this morning that it “continues to believe that the Tribune Board should engage constructively…toward negotiating a merger agreement that benefits both companies’ stockholders. Gannett also believes it is imperative for due diligence to occur soon given the apparent rapid series of changes taking place inside Tribune that may diminish the value of Tribune to Gannett.”
Ferro has said that he would talk if Gannett signs a non-disclosure agreement . The Virginia-based publisher says it would agree to “a customary NDA” that doesn’t “limit its options to submit an offer directly to Tribune stockholders. Gannett believes that maintaining this flexibility is important in light of the continued opposition to Gannett’s offer from Tribune’s Ferro-led board.”