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Pitch to Gannett shareholders released

Possible buyer: Gannett has ‘continually destroyed shareholder value’

By David Wildstein, April 11 2019 6:33 pm

MNG Enterprises/Digital First Media has released the presentation that they will deliver to Gannett shareholders next month as they seek to purchase the media giant in takeover bid worth $1.7 billion.

Gannett owns eight daily newspapers in New Jersey: The (Bergen) Record, the Asbury Park Press, the Courier News, the Courier-Post, the Home News Tribune, the Daily Record, the Daily Journal, and the Herald News.

Since Gannett rejected the $12-per-share offer, the company has reported wider than expected losses for the fourth quarter of 2018.  MNG says that Gannett has lost two-thirds of its free cash flow over the last four years.  They said Gannett’s share price has declined 41% since a 2015 spinoff.

Gannett has accused MNG/Digital First, which is backed by a New York hedge fund, of avoiding details about its ability to finance their takeover bid.

The Record has laid off six employees this year while their CEO’s compensation by has gone up 17% over the last four years to $8.7 million annually.

According to MNG, Gannett has spent about $350 million on digital media acquisitions while EBITDA has declined by 31% and cash flow by nearly 50%.

An independent analyst, J.P. Morgan, has called the MNG/Digital First offer “a potentially favorable exit for shareholders.”

Digital First Media owns more than 200 newspapers nationwide, including the Trentonian.

The Gannett newspapers in New Jersey have had a virtual blackout of news on the takeover bid, including no report of today’s news on their earnings and revenues.

Rep. Bill Pascrell (D-Paterson) announced his opposition to the sale in February, saying that approval of a deal to let a “predatory hedge fund take over one of America’s largest, most trusted news companies would take one more wrecking ball to our independent press.”

MNG-GCI-Shareholder-Presentation
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