Gannett CEO Tells Employees: Company Not for Sale
Gannettis not for sale, Chief Executive Craig Dubow said in a memorandum to employees, shooting down rampant speculation that the biggest U.S. newspaper publisher is preparing for a change of control.
Gannett , owner of USA Today, has been the subject of speculation among financial analysts that it could go private.
"None of the bloggers called and checked with us before speculating that we were preparing for a sale," Dubow wrote in the memo obtained by Reuters. "We are not."
A Gannett spokeswoman said the memo was sent Friday.
Dubow was responding to the most recent speculation, raised in a Wall Street Journal blog entry, that said changes to some employee compensation plans suggested the possibility the publisher could be up for sale.
Gannett, like other U.S. newspaper publishers, has been dealing with a drop in advertising sales and paid circulation because of a migration of readers to the Internet and, more recently, a downturn in the housing market.
On Aug. 9, an entry in The Wall Street Journal's Deal Journal blog speculated that Gannett "may be hearing the footsteps of a potential acquirer approaching."
The Journal said a filing that Gannett had made with federal regulators had amended some employee compensation plans "with an eye toward a possible acquisition of the company."
"In the event of a change in control of the company, certain deferred compensation payments would be accelerated," the Journal said. "The amendments also would prevent retirement-plan changes brought on by any merger deal that would reduce benefits to employees."
Speculation about Gannett's future was rekindled by the successful bid by News Corp. for Dow Jones and followed on the heels of other deals including the proposed buyout of Tribune and the sale of Knight Ridder.
News Corp is buying Dow Jones for more than $5 billion, while Tribune is going private in a more than $8 billion deal engineered by Chicago real estate tycoon Sam Zell.
McClatchy bought Knight Ridder in 2006.
Gannett shares reversed course and rose as high as 2% Friday after news of the memo was made public.
The stock was up 43 cents at $47.77 on the New York Stock Exchange in late morning trading.