Tribune Publishing Co. confirmed that a rival bid for the newspaper giant lost its biggest funding source, leaving hedge fund Alden Global Capital positioned to succeed in taking over the company.
Swiss billionaire Hansjoerg Wyss is dropping out of the $18.50-a-share bid led by Choice Hotels International Inc. Chairman Stewart Bainum Jr., Bloomberg News reported Saturday. After conducting due diligence for the past two weeks, Wyss decided not to go forward with the proposal, people familiar with the situation said.
In a filing Monday, Tribune said it received a letter from Bainum informing the company of Wyss's departure. That led Tribune to conclude that the bid from the Bainum group could no longer lead to an offer superior to Alden's $17.25-a-share proposal, and the company ended talks with the rival potential bidder.
The Bainum-Wyss group, which called itself Newslight, was seen as friendlier to the publishing company's news staff than Alden, since the investors have vowed to protect local journalism. Alden, which already owns 32% of Tribune Publishing, has a reputation for deep cuts at the companies it acquires. Tribune's newspapers include the Chicago Tribune and New York Daily News.