Newspaper publisher Tribune Publishing Co said its board had adopted a shareholder rights plan - popularly known as a "poison pill" - in a bid to thwart Gannett Co Inc's unsolicited take-over offer. Tribune shares fell nearly 6 percent in morning trading on Monday, while Gannett shares were little changed. The rights will become exercisable after a group buys more than 20 percent of Tribune Publishing's shares.
If the rights plan is triggered, Tribune shareholders will get the number of shares having a market value of two times the exercise price of the right, the company said. Gannett, the owner of USA Today, made a take-over bid for Tribune last month at $12.25 per share in cash, valuing the publisher of the Chicago Tribune and the Los Angeles Times at about $815 million. Tribune rejected the offer last week. "Our board is unanimous that Gannett will not succeed with its current tactics and low ball price," Tribune Chief Executive Justin Dearborn said in a statement on Monday.
Instead of negotiating a mutually agreeable deal, Tribune is "putting up another roadblock to prevent its stockholders from realising compelling, immediate and certain cash value for their investment," Gannett said in an emailed statement. The tussle comes at a time when the print industry is grappling with declining circulation, shrinking advertising revenue and a shift toward digital content.