Gannett poised to hold off Digital First takeover bid
Gannett Co. is poised to retain control of its entire board in a proxy fight with a hedge-fund-backed rival that made a hostile bid for the USA Today owner, according to people familiar with the matter.
Based on the shareholder votes that have been cast so far, Gannett’s GCI, +1.60% eight nominees have received significantly more support than the three put forward by Digital First Media, the people said. The eight nominees who receive the highest number of votes cast will be elected.
The results are preliminary and shareholders could still change their votes through Gannett’s annual meeting Thursday morning. Digital First, officially known as MNG Enterprises Inc., did get some support beyond its own shares, which amount to a 7.4.% Gannett stake. Most notably, index-fund giant BlackRock Inc. BLK, -0.34% , which owns a roughly 14% stake, supported two Digital First nominees, some of the people said.
Digital First has been urging Gannett, which owns over 100 daily newspapers and is the country’s largest publisher by circulation, to launch a strategic review since it made an unsolicited, $1.4 billion bid in January. Gannett rejected the bid, which it said undervalues the business, and has cast doubt on Digital First’s ability to raise funding. It also highlighted the firm’s reputation for deep cost cuts at the roughly 200 titles it owns, including the Denver Post and San Jose Mercury News.
An expanded version of this report appears on WSJ.com.
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