Tribune Publishing Considers New Offer From Surprise Bidders
Two months after agreeing to sell itself to Alden Global Capital, a New York hedge fund, the company behind The Chicago Tribune and The Baltimore Sun may shift course.,
Tribune Publishing, the newspaper chain that includes The Chicago Tribune, The Daily News and The Baltimore Sun, said on Monday that it has begun serious discussions about a sale of the company to a pair of bidders who came through with an offer nearly two months after Tribune agreed to sell itself to Alden Global Capital, a New York hedge fund.
The new bid, which is greater than the amount offered by Alden, was made on Thursday by Stewart W. Bainum Jr., a Maryland hotel magnate, and Hansjorg Wyss, a Swiss billionaire who made his fortune as a manufacturer of medical devices.
The two have joined together in a company called Newslight. Tribune Publishing announced on Monday that it would “engage in discussions and negotiations” with Mr. Bainum and Mr. Wyss. The company added that, for now, it will not “terminate the Alden merger agreement or enter into any merger agreement with Newslight, Mr. Bainum or Mr. Wyss.”
Until recently, it looked as though Alden Global Capital would almost certainly become the next owner of Tribune. Late last month, Mr. Wyss emerged as a surprise new player, telling The New York Times that he would team up with Mr. Bainum in a bid for the chain. On Thursday, Mr. Wyss and Mr. Bainum submitted their bid, which valued Tribune at $18.50 a share, beating Alden’s offer of $17.25.
The bid from Mr. Wyss and Mr. Bainum valued the company at about $680 million; Alden’s bid put the value of Tribune at roughly $630 million. The news of the offer was reported earlier by The Wall Street Journal.
Tribune Publishing said on Monday that its special committee had determined that the competing bid from Mr. Wyss and Mr. Bainum would be reasonably expected to lead to a “superior proposal” than the Alden bid.
But the Tribune advised caution, telling shareholders, “There can be no assurance that the discussions with Newslight and its principals will result in a binding proposal.”
Nearly two months ago, Mr. Bainum had reached a nonbinding agreement to establish a nonprofit that would buy The Sun and two other Tribune-owned Maryland newspapers from Alden, for $65 million, after the Alden-Tribune deal gained shareholder approval. That agreement ran into trouble soon after it was made, however. Last month, Mr. Bainum, the chairman of Choice Hotels International, one of the world’s largest hotel chains, made a bid for all of Tribune, offering $18.50 a share.
After considering the bid from Mr. Bainum last month, Tribune said it still favored the agreement with Alden, which had solid financing. At the same time, the board informed Mr. Bainum that he was free to find backers to make his offer more attractive. He did just that by joining with Mr. Wyss.
Journalists in Tribune newsrooms have been sharply critical of Alden, which already owns roughly 32 percent of the company, as a potential owner. Alden, the owner of some 60 daily newspapers across the country through MediaNews Group, is known for making deep cuts at publications it controls, often laying off significant numbers of newsroom employees as it tries to wring profits out of a struggling business. Alden says its strategy keeps newspapers from going out of business.
In an interview last week, Mr. Wyss, 85, said he was partly inspired to join Mr. Bainum by a Times opinion essay in which two former Chicago Tribune reporters, David Jackson and Gary Marx, warned that Alden would create “a ghost version of The Chicago Tribune.” Other Tribune journalists, from California to Maryland, have led campaigns to persuade local benefactors to buy Tribune Publishing, or at least one of its papers.
Mr. Wyss, who lives in Wyoming, said he joined the effort to buy Tribune because of his belief in a robust press. “I don’t want to see another newspaper that has a chance to increase the amount of truth being told to the American people going down the drain,” he said in the interview last month.