Digital First Media is making an aggressive play to buy Gannett, offering $12 a share for the struggling publisher on Monday. The figure is a 23 percent premium on Gannett's current share price of roughly $9.75.
Digital First Media already owns a 7.5 percent stake in the publisher. In a letter to the Gannett board of directors, Digital First said the current leadership was not working and cited the company's tumbling share price since going public more than two years ago as proof.
The news was first reported in the Wall Street Journal.
Gannett, which publishes USA Today in addition to a number of local papers, has faced many of the same industry headwinds that have hollowed out local newspapers in recent years. The company is currently without a CEO and it is unclear how they will ultimately respond to the interest from Digital First.
In a statement to TheWrap, Gannett confirmed it has received an "unsolicited proposal" from the media company and they were still weighing what to do.
"Consistent with its fiduciary duties and in consultation with its financial and legal advisors, the Gannett board of directors will carefully review the proposal received to determine the course of action that it believes is in the best interest of the company and Gannett shareholders. No action needs to be taken by Gannett shareholders at this point," Gannett said.
Digital First Media, which is backed by the hedge fund Alden Global Capital, has become an extraordinarily divisive media player in recent years and has been accused by critics of buying up local papers and strip mining them of their assets and talent. The company is most notable for their management of the Denver Post, which has slashed more than half their staff in recent years. The situation became so desperate last year that the paper's remaining editorial staff published an op-ed denouncing their corporate overlords.
"Digital First Media's hedge fund owner slashes local newsrooms to the bone, soaks them for profits and then spends money on things that aren't journalism," warned Los Angeles Times National Correspondent Matt Pearce. "If they're knocking on the door, you should lock the deadbolt."