Gannett's headquarters in McLean, VA. (Photo: Tim Loehrke, USAT)
Gannett's shareholders have voted to reject the candidates for the MNG Enterprises Board, which were associated with the US owner at the time they are trying to defend a hostile takeover of the newspaper company controlled by hedge funds.
Gannett's chairman, J. Jeffry Louis, announced Thursday that the shareholders of the company supported the eight members of the board that elected to re-elect, according to preliminary results of the vote. The three nominees proposed by MNG Enterprises of Alden Global Capital did not get seats on the board.
Preliminary results were revealed during Gannett's annual meeting. The certified official results will be submitted in a matter of days. Vot totals were not immediately available. The audience applauded when the results were announced.
Bernard Lunzer, president of the NewsGuild Syndicate, praised Gannett for taking part in MNG nominees.
"I applaud Gannett why he still believes in sustainable journalism," Lunzer said. "It is a difficult task now. We believe there is a strong future."
MNG in January made an unsolicited offer to acquire Gannett for $ 12 per share. Gannett rejected the offer as not credible and argued that the MNG nominees had potential conflicts of interest.
While MNG could still follow an acquisition, its failure to secure posts at the Gannett board reflects a significant setback in its efforts. With seats on the board, MNG could have stirred up for a potential deal.
MNG did not indicate if it would continue its campaign to acquire Gannett.
"This is a triumph for a consolidated adviser to Gannett who has not been able to solve the current realities of the newspaper business and, unfortunately, a loss for Gannett and its shareholders," MNG said in a statement. "Gannett's newspapers are important local resources and we hope that the Gannett Board and its Management will go through a modern approach to local news that will save newspapers and serve communities. This would be the best result. If the Gannett Board did not It changes course of charging overpayments for non-central digital offers, with aspirations and dilutions, we believe that the actions will go down even more. "
Shareholder advisory and corporate shareholder services and Glass Lewis questioned the ability of MNG to finance the offer, but said $ 12 per share would be a reasonable starting point for the conversations Gannett's shares increased from 2 cents to $ 8.89 per share during the morning.
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The members of the board of directors of Gannett were President John Jeffry Louis, John E. Cody, Stephen Coll, Donald Felsinger, Lila Ibrahim, Lawrence S. Kramer, Debra A. Sandler and Chloe R. Sladden.
MNG, also known as Digital First Media, had named three members: MNG's former president, Steven Rossi, Cogent Group's director, Dana Goldsmith Needleman, and President of Alden, and MNG Vice President, Heath Freeman.
ISS supported Rossi, but did not approve of the other two. Glass Lewis did not approve any of MNG nominees.
MNG had previously appointed six people to the board, but withdrew three amid the growing scrutiny of the Alden track record of cuts and investment failures.
Gannett has argued that it has an achievable plan for digital transformation and that it manages the costs closely. MNG has argued that Gannett should stop investing in digital companies and that they need "adequate overall costs".
Critics say that MNG's career in the implementation of cost cuts in newspapers, including Denver Post and San Jose Mercury News, is not a recipe for growth.
It follows the US reporter TODAY Nathan Bomey on Twitter @NathanBomey.
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