Gannett makes $815 million offer for Tribune Publishing Co.

McLean-based Gannett Co. Inc. on Monday announced an unsolicited $815 million bid to acquire Chicago-based Tribune Publishing Co.

The all-cash offer includes $12.25 for each Tribune share, a 63 percent premium on Tribune’s closing stock price of $7.52 on Friday.

Tribune’s properties include The Daily Press in Newport News.

In announcing its offer, Gannett released a letter sent to Tribune’s board of directors on Monday.

The letter said that Tribune on Friday had rebuffed Gannett’s $12.25 per-share offer, which had first been submitted on April 12.

Tribune confirmed on Monday that it has received an unsolicited offer, “with numerous contingencies,” from Gannett.

“On April 22, Tribune Publishing’s Board sent a letter to Gannett indicating it was finalizing engagements with Goldman, Sachs & Co. and Lazard as financial advisors and Kirkland & Ellis LLP as legal advisor,” Tribune said in a news release. “The Board is now engaged, with the assistance of its advisors, in a thorough review. The Board is committed to acting in the best interests of shareholders and will respond to Gannett as quickly as feasible.”

Tribune said it has been involved in many organizational changes since the beginning of the year, with a new board chair, CEO and CFO, while implementing a “content-first strategy.”  The strategy “centers on using innovative technology to leverage Tribune Publishing’s valuable content and distribution channels.”

In its letter on Monday, Gannett stressed the “financial and strategic logic of a combination of our two companies… The challenges for our industry in the digital age continue … By combining, we would create a company with the financial stability and flexibility equipped to preserve journalistic integrity, high standards and excellence for years to come. We would be able to both empower our journalists and facilitate the creation of exceptional content while delivering stockholder value.”

Gannett said the proposed deal would create savings of $50 million annually. The $815 million offer includes the assumption of $390 million in Tribune debt.

The company said it can quickly consummate the acquisition without any financing condition.

Gannett publishes USA Today and has publications in more than 120 markets internationally.

Tribune’s properties include 11 daily newspapers, more than 60 digital properties and more than 180 news verticals.

In addition to the Virginia Peninsula, its markets include Los Angeles, San Diego, Chicago, Orlando and Baltimore.