Gannett upped the ante Monday, letting Tribune Publishing shareholders know it would now pay $15 a share to take over the company. The original offer was $12.25, and the value of the stock when Gannett made it in April was about $7.50. Gannett’s behaving like an army laying siege, dropping leaflets onto the rabble within that say, We come to free you. Rise up and open the gates.
Gannett is also urging shareholders to express their solidarity by refusing to vote at the June 2 annual meeting for any of the company’s eight nominees for the board of directors.
“Recent changes to the board to add directors with significant ties to Michael Ferro call into question the true independence” of the board, said Gannett in a Friday news release. Boycotting the election “will send a clear and constructive message that its Board should immediately enter into serious, constructive discussions.”
I read this news release and thought, This is nasty!
It’s tempting to think that when one destiny is weighed against the other, control of the Chicago Tribune by the Gannett chain instead of Ferro doesn’t look so bad.
I haven’t resisted the temptation. For instance, in this recent post I observed that Gannett’s strategy for rallying Tribune Publishing shareholders to support its takeover bid seems to involve reminding them that if it fails, Ferro will run the company instead. Ferro bought his controlling interest only in February, and if the shareholders act fast, maybe the Ferro era will come to seem like just a bad dream.
But the core of the strategy is simply to wave money at the shareholders and count on them to snatch it—because money is a lovely thing, and, in the precarious media business especially, the chance to grab a handful might not come around again.
And when I separate out Ferro (which isn’t easy) and think of Gannett’s takeover bid simply as a power play to buy the company, I don’t like anything about it.
I don’t like seeing the Tribune reduced to booty in a corporate Game of Thrones, with today’s usurper hoping to fend off tomorrow’s. I don’t like the army at the gates—Gannett publishes second-rate papers in second-string cities, and this, to me, is like DeVry making a hostile bid for the University of Chicago. And I don’t like the reminder that corporate directors have a duty to shareholders that transcends anything they owe their employees, or their readers, or the city they serve.
For instance, I know someone who bought stock in the old Tribune Company even though he despised it, because he wanted inside knowledge of all its shenanigans. I’d write more evocatively if I’d done that too, because Gannett would now be trying to seduce me rather than simply keep me informed with its news releases. But it pains me to think that if I owned just a single share of Tribune Publishing, Ferro and the board would have a fiduciary duty to me greater than its duty to someone who’s worked at the company 30 years.
With no real skin in the game, I can speak only as a Chicagoan who’s read the Tribune for more than 40 years and has been writing about for it nearly as long: the Tower is a city landmark and a seat of power—it isn’t a branch office. The Tribune should no more be run out of Gannett’s headquarters in Tysons Corner, Virginia, than—well, than the Los Angeles Times should be run out of Chicago.
If this takeover goes through, there are people in Tribune Tower who might understand for the first time why Chicago was a dirty word inside the Times. Nobody likes to be colonized.
Now everyone at both papers can feel collectively sorry for themselves at the prospect of taking orders from Tysons Corner.