Efforts to buy the publisher of the New York Daily News and the Chicago Tribune are heating up yet again.
On Monday, Tribune Publishing said the special committee advising its board on a sale has given the thumbs up for the company to start reviewing a $680 million buyout offer by hotel magnate Stewart Bainum and Swiss-born investor Hansjorg Wyss.
The Bainum/Wyss offer, made through their newly formed Newslight joint venture, offers to pay Tribune shareholders $18.50 a share in cash — rivaling a $17.25-per-share cash offer by hedge fund Alden Global Capital.
The latter offer values Tribune at $630 million and was approved by the board in February.
But the publishing giant, which also owns the Orlando Sentinel and the Hartford-Courant, said in its Monday press release the special committee has determined that Newslight’s offer can reasonably be expected to lead to a superior proposal.
“The acquisition proposal from Newslight is fully financed by equity commitments from Mr. Bainum and Mr. Wyss, and remains subject to certain conditions, including completion of due diligence and negotiation of definitive documentation,” Tribune said Monday, confirming a Sunday report by the Wall Street Journal.
The approval paves the way for Tribune to start conducting its due diligence on Newslight’s offer and to see if they to reach a definitive purchase agreement.
The progress made by the billionaire duo is expected to be welcome news to Tribune staffers given Alden’s reputation for brutal cost-cutting at newspapers it controls through its Media News Group.
Still, the battle isn’t over yet. The special committee’s move doesn’t necessarily mean Tribune will nix its existing merger agreement with Alden. Alden, a large Tribune shareholder with two seats on Tribune’s board, could always seek to top the rival offer.
Alden, which already owns 31.6 percent of Tribune purchased at an average price of $12.38 over the course of the past 18 months, could also choose to walk away. That decision would net it about $100 million for its stake, plus $20 million from the bust-up fee agreed to by Tribune.