Two unlikely billionaires are on the verge of derailing a massive newspaper deal that would likely have resulted in the loss of hundreds of local journalism jobs across the country.
Driving the news: Hotel magnate Stewart Bainum Jr. Maryland-based Swiss billionaire Hansjörg Wyss have reportedly agreed to pay more than $ 600 million of their own money to fund a bid of approximately $ 680 million for Tribune Publishing, the parent company of many of America’s most iconic newspapers.
- The billionaires’ offer can now be recommended for consideration by the Tribune board to its shareholders on a cheaper offer from private equity giant Alden Global Capital, according to The Wall Street Journal.
- In February, Alden said it would acquire the rest of Tribune Publishing, the parent company of the Chicago Tribune, New York Daily News, and other local newspapers, in a deal that valued Tribune at approximately $ 630 million.
- Sunday, The Journal reported that Banium Jr. and Wyss were able to secure funding for their offer after originally proposing to bring in $ 200 million of their own dollars. Alden has four days to come up with a higher offer or you risk losing the deal, according to The Journal.
Be smart: Alden Global Capital is a hedge fund known for cutting back on journalists from local newspapers to maximize profits. It has spent years positioning itself as Tribune’s presumed buyer, incrementally increasing its stake in the publicly traded company.
- The Journal reported that public pleas from Chicago Tribune journalists to save the newspaper from Alden’s expected destruction inspired Wyss to make the offer.
- Last weekend, The New York Times reported that Wyss joined Bainum Jr. added in its bid for the Tribune newspapers, with plans to own the Chicago Tribune.
- Bainum Jr. originally said he would buy the Baltimore Sun, The Capital Gazette in Annapolis, and a few other smaller Maryland newspapers from Tribune for a reported $ 65 million to turn the newsgroup into a nonprofit.
- The Journal reports that Banium Jr. still plans to convert the Margland-based newspapers into non-profit organizations, and put them in control of private trusts.
Be smart: Other wealthy individuals are apparently looking for ways to save their local newspapers from the potential takeover of Alden.
- Last week, The Journal reported that a Florida investor named Mason Slaine, who is a minority investor in Tribune, was willing to put in $ 100 million in the offer for Tribune led by Bainum Jr.
- The WSJ noted on Sunday that Slaine is not included in the new offer made by Banium Jr. and Wyss has been submitted to Trubune’s board.
- Slaine reportedly looked into ownership of Tribune’s two Florida papers, the Orlando Sentinel and the Sun Sentinel in Fort Lauderdale.
- Last weekend, the Morning Call, a newspaper representing Lehigh Valley, Pennsylvania and owned by Tribune Publishing, reported that a Manhattan investor was the mysterious bidder behind a $ 30- $ 40 million bid for the newspaper.
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