A hedge fund-owned newspaper company with its eyes on Gannett Co. is launching a hostile bid to take control of Gannett's board of directors.
According to USAToday, MNG Enterprises Inc., also known as Digital First Media, notified Gannett of its plans to nominate six directors to its board.
The move sets the stage for a high-stakes tug of war between the two media companies over control of Gannett, which owns USAToday, more than 100 local media brands and digital marketing assets such as ReachLocal and SweetIQ.Gannett on Monday said its board had unanimously rejected MNG's unsolicited bid to buy the company for $12 per share, saying it was not "credible."
Gannett shareholders will ultimately vote on whether to elect new board members, keep the current slate or choose a mix. Names of nominees were not immediately available.
In a statement, Gannett said it "will consider whether MNG is nominating these candidates to support its acquisition proposal, which the board has already rejected, and whether MNG’s proposed nominees are committed to acting in the best interests of all of Gannett’s shareholders, or are beholden to MNG."
Digital First, majority owned by New York hedge fund Alden Global Capital, operates daily and weekly publications including the Denver Post and the Boston Herald.
MNG, which holds a 7.5 percent ownership stake in Gannett, has argued it can do a better job with the business. MNG representatives did not immediately respond to a request seeking comment Thursday
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