News Journal, Daily Times and USA Today owner Gannett is facing a takeover bid.
MNG Enterprises, a company that is best known as Digital First has offered to pay $12 a share for the remaining stock and claims current management has not shown an ability to effectively run the company.
MNG has a 7.5 percent stake in Gannett and demanded discussions on a business combination. MNG also called on Gannett to halt further digital investments.
Click here for the release from Digital First.
The company went on to claim that current management was not performing well, the Wall Street Journal reported.
Digital First takes an aggressive stance in cutting costs and laying off staff. newspapers. The company is privately held with hedge fund Alden Global Capital controlling its stock.
Digital First properties include suburban Philadelphia papers and websites, including the Daily Local News which covers the West Chester area.
Its cost-cutting actions at the Denver Post led to outrage and resignations among the staff. However, the company is believed to be profitable, thanks to its cost-cutting efforts, the Wall Street Journal reported.
https://twitter.com/murraymatt/status/1084617442658263040
Gannett, like other newspapers companies, has struggled with plunging display and classified advertising revenues. It has sharply reduced the size of the reporting and editing staff at the News Journal and other properties.
Its corporate strategy has involved tying local papers like the News Journal and the Daily Times with a section comprised of USA Today content. The company has also invested in digital areas including the nearby hyperlocal website, Billypenn.com.
After Gannett spun off its local television holdings into a separate company (Tegna), it went on a buying spree but has not been acquiring papers of late as print advertising continues to deteriorate with digital ads not filling the gap.
