Swiss billionaire Hansjörg Wyss has agreed to contribute $ 100 million to buy Tribune Publishing, teaming up with a Maryland hotel mogul to prevent a hedge fund takeover of one of the world’s largest companies. American press.
Wyss has teamed up with Stewart Bainum, president of Choice Hotels, who this month offered to buy Tribune for $ 650 million in hopes of running its newspapers, including the Chicago Tribune, the New York Daily News and the Baltimore Sun, as a non-profit organization.
Wyss’s entry is the latest twist in a battle to control Tribune after Alden, a New York hedge fund known for taking over struggling US newspapers, struck a deal last month to buy out the media group that valued it at $ 630 million.
As part of the deal, Tribune would sell the Baltimore Sun and two other Maryland newspapers to Bainum for around $ 65 million. However, Bainum and Alden have not been able to agree on the details of the deal in recent weeks, which has prompted Bainum to mount its own company-wide offer.
Bainum had been looking for investors in recent days to join its offer for the whole of Tribune. He plans to invest $ 100 million of his own money, while Wyss has agreed to contribute $ 100 million and could also provide debt if needed, according to people familiar with the deal. Bainum has also sparked interest from banks in providing debt financing, the people said.
The interest of Wyss, the American-Swiss entrepreneur who made his fortune in the production of medical devices, will give heart to Tribune journalists who have made the takeover battle an existential fight against the influx of financial groups in their business.
After decades of declining revenues, struggling US newspapers have become targets for hedge funds and private equity.
Alden has been a leading consolidator, drastically reducing the costs of its securities to increase profitability. Employees at its publications have described the company as “vulture capitalists” while politicians such as Democrat Chuck Schumer, the Senate majority leader, have argued that the hedge fund’s management of local newspapers has an impact. negative impact on American democracy.
The tribune’s unions over the past year have launched a campaign against Alden, seeking wealthy local individuals to buy their newspapers, which has helped inspire Wyss’ interest in buying the company, a- he told the New York Times. “I don’t want to see another newspaper that has a chance to increase the amount of truth being told to the American people,” he said.
Wyss and Bainum plan to eventually find investors for the Tribune newspapers, with the aim of turning them into non-profit organizations.
Despite Bainum’s best efforts, Tribune’s board last week recommended that shareholders vote for Alden’s offer, after concluding it offered greater certainty than any other option, according to a regulatory filing .
The takeover of Alden requires the approval of at least two-thirds of Tribune’s shareholders excluding Alden. That could leave Tribune’s fate in the hands of Patrick Soon-Shiong, the pharmaceutical billionaire and owner of the Los Angeles Times, who owns around 24% of Tribune – a stake large enough to complicate Alden’s plans.