Two unlikely billionaires may be getting in the way of a big deal with a newspaper that would likely result in the loss of hundreds of local journalism jobs across the country.
Driving the news: Maryland hotel magnate Stewart Bainum Jr. and Swiss billionaire Hansjörg Wyss have agreed to put more than $ 600 million of their own money to help finance an offer of around $ 680 million by Tribune Publishing, the company responsible by many of America’s most iconic newspapers.
- The billionaires’ offer, according to The Wall Street Journal, can now be recommended for consideration by the Tribune board for its shareholders rather than a cheaper offer from private equity giant Alden Global Capital.
- In February, Alden said it would buy the rest of Tribune Publishing, the parent company of the Chicago Tribune, the New York Daily News and other local newspapers, in a deal valuing the Tribune at about $ 630 million.
- On Sunday, The Journal reported that Banium Jr. and Wyss were able to secure financing for their offer after initially proposing $ 200 million of their own dollars. Alden will have four days to bid higher, or risk losing the deal, according to The Journal.
Be smart: Alden Global Capital is a hedge fund known for cutting journalists in local newspapers to maximize profits. It has spent years positioning itself as the likely buyer of Tribune, gradually increasing its stake in the publicly traded company.
- The Journal reported that public calls from journalists at the Chicago Tribune to save the paper from Alden’s early destruction was what inspired Wyss to make the offer.
- Last weekend, The New York Times’ reported that Wyss was joining Bainum Jr. in his bid for the Tribune newspapers, with plans to own the Chicago Tribune.
- Bainum Jr. originally said he would buy the Baltimore Sun, The Capital Gazette in Annapolis and a few other smaller Maryland newspapers from Tribune for $ 65 million to turn the newsgroup into a nonprofit organization.
- The Journal reports that Banium Jr. is still planning to turn Margland’s newspapers into nonprofits, and put them in control of private funds.
Be smart: Other wealthy individuals are apparently looking for ways to help save their local newspapers from the possible acquisition of Alden.
- Last week, The Journal reported that a Florida investor named Mason Slaine, who is a minority investor in Tribune, was willing to put $ 100 million into the offer by Tribune led by Bainum Jr.
- The WSJ noted on Sunday that Slaine is not included in the new offer submitted to the Council of Trubune by Banium Jr. and Wyss.
- Slaine was reportedly investigating the ownership of two Tribune newspapers in Florida, Orlando Sentinel and Sun Sentinel in Fort Lauderdale.
- Last weekend, Morning Call, a newspaper representing Lehigh Valley, Pennsylvania, owned by Tribune Publishing, reported that a Manhattan investor was the mysterious bidder behind a $ 30- $ 40 million bid for the newspaper.
Go deeper: Billionaires collect news outlets as a new form of philanthropy.