Tribune Publishing, the newspaper chain that owns The Chicago Tribune, The Daily News and The Baltimore Sun, announced Monday that serious discussions had begun about selling the company to two bidders who made an offer almost two months later ready to sell to Alden Global Capital, a New York hedge fund.
The new offer, which is more than the amount offered by Alden, was made Thursday by Stewart W. Bainum Jr., a Maryland hotel magnate, and Hansjörg Wyss, a Swiss billionaire who made his fortune as a medical device maker.
The two have formed a company called Newslight. Tribune Publishing said Monday it would have “talks and negotiations” with Mr Bainum and Mr Wyss. The company added that for the time being it “will not terminate the Alden merger agreement or enter into a merger agreement with Newslight, Mr. Bainum or Mr. Wyss”.
Until recently, it looked like Alden Global Capital was almost certain to become Tribune’s next owner. Late last month, Mr. Wyss emerged as a surprising new player, telling the New York Times that he would be teaming up with Mr. Bainum to bid for the chain. On Thursday, Mr. Wyss and Mr. Bainum made their offer, which the Tribune valued at $ 18.50 per share, beating Alden’s offer of $ 17.25.
The bid from Mr. Wyss and Mr. Bainum valued the company at approximately $ 680 million. Alden’s offer put the Tribune’s worth at around $ 630 million. News of the offer was previously reported by the Wall Street Journal.
Tribune Publishing said Monday that its select committee had determined that the competing bid from Mr. Wyss and Mr. Bainum would reasonably result in a “superior proposal” than Alden’s offer.
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The Tribune advised caution, however, telling shareholders: “There can be no guarantee that discussions with Newslight and its clients will result in a binding proposal.”
Almost two months ago, Mr. Bainum reached a non-binding agreement to create a nonprofit to buy The Sun and two other Maryland newspapers from Alden for $ 65 million after the Alden Tribune deal approved the Alden Shareholders had received.
However, this agreement ran into trouble soon after its inception. Last month, Mr. Bainum, chairman of Choice Hotels International, one of the world’s largest hotel chains, made a full tribune offer for $ 18.50 per share.
After considering Mr Bainum’s offer last month, Tribune said it remains in favor of the deal with Alden, which has solid funding. At the same time, the board informed Mr. Bainum that he was free to find supporters to make his offer more attractive. He did just that by joining Mr. Wyss.
Journalists in Tribune newsrooms sharply criticized Alden, who already owns around 32 percent of the company, as a potential owner. Owning around 60 daily newspapers across the country through the MediaNews Group, Alden is known for cutting deeply into the publications he controls in order to wrest profit from companies in trouble. Alden says his strategy is preventing newspapers from going out of business.
In an interview last month, 85-year-old Wyss said he was partly supported by a Times opinion piece in which two then-Chicago Tribune reporters, David Jackson and Gary Marx, warned that Alden would “create a ghost” been inspired to join Mr. Bainum’s version of The Chicago Tribune. “Tribune journalists from other newspapers have campaigned to convince local benefactors to buy Tribune Publishing, or at least one of its newspapers.
Mr. Wyss, the former managing director of the Synthes medical device company, has a home in Wyoming. A decade ago, he led the sale of Synthes to Johnson & Johnson for approximately $ 20 billion. Since then, he has donated hundreds of millions of dollars to preserve wildlife habitats in Wyoming, Montana, Maine, and elsewhere. He has also been a major donor to liberal groups keen to shape American politics, including the Center for American Progress, where he serves on the board.
Mr Wyss said in an interview with The Times last month that he had joined efforts to buy Tribune because he believed in the need for a robust press. “I don’t want to see any other newspaper that has a chance to increase the amount of truth that is being told to the American people who are going down the drain,” he said.
