News that the McClatchy bid for Tribune Publishing is dead as a doornail sent the stock spiraling to another new 52-week low on Tuesday — slumping to $12.40 a share before closing at $12.45, down 4.1 percent.
Will Wyatt, a former hedge fund operator, has been looking at the books in recent days to see how much — if anything — he may bid now that he appears to be the sole surviving potential bidder.
If he lands the deal, he is planning to bust up the company that includes the Chicago Tribune, the Baltimore Sun, the Sun Sentinel in Fort Lauderdale and the struggling New York Daily News, among other titles, and sell it off in pieces. He’s said to be in the process of lining up buyers.
Bloomberg reported that the McClatchy bid that was rejected was to include mostly cash and some stock, valuing Tribune at $16.50 a share. Media Ink sources say the deal was $15 a share in cash and $1.50 in stock — but the company that would have emerged would be weighed down with more than $1 billion in debt.
And the prospect of holding any stock in a debt-heavy combined company may have soured the largest Tribune shareholder, former Tribune Publishing chairman Michael Ferro, on the deal. “He torpedoed the deal,” said one source in the middle of the talks.
But another line in the fast-flying rumor mill around the collapsed deal says that LA Times owner Patrick Soon-Shiong, who still owns 25 percent of Tribune stock, may have thrown a wrench into the McClatchy plan. He was apparently willing to roll his stock into a new McClatchy-Tribune but backed out of a plan.
If Wyatt doesn’t like what he finds, as he does due diligence on Tribune’s finances, the tortured auction could end with no sale.
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