Hedge fund-backed media company MNG Enterprises Inc., owner of the Los Angeles Daily News, has made an unsolicited bid for Ventura County Star publisher Gannett Co.
MNG offered to acquire the publicly traded newspaper group – which owns USA Today and nearly two hundred local newspapers across the country – for $12 share, Denver-based MGN announced Monday. The bid is more than 20 percent above the closing price of $9.75 the day before the offer was made.
MNG, also known as Digital First Media, is controlled by New York hedge fund Alden Global Capital LLC. It owns more than 100 publications nationwide including the Los Angeles Daily News, Orange County Register, Denver Post and Boston Herald.
In a letter to the Gannett board, MNG said Virginia-based Gannett has underperformed as a public company, citing a 41 percent decline in share price since its initial public offering in 2015. Gannett said in a statement it is reviewing the proposal but did not give a timeline for a decision.
Gannett purchased the Ventura County Star in 2016 as part of a $280 million deal for its parent company, Journal Media Group. The daily newspaper serves all of Ventura County and is headquartered in Camarillo.
Some in the media industry have criticized MNG for scaling back operations and laying off staff at papers it acquires. At its 11 Southern California publications, the company has cut newsrooms “by nearly half in just the past two years,” former Southern California News Group Executive Editor Frank Pine wrote in an op-ed in April.
In the letter to Gannett, MNG positioned itself as a savior for the newspaper business.
“When other people won’t step up, we do,” the letter said. “We save newspapers and position them for a strong and profitable future so they can weather the secular decline.”