Gannett Shareholders Reject MNG Nominees, Avoiding Takeover For Now

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UPDATE: Gannett/Tribune merger talks?

There's some fairly good news for people who care about the information industry.

In an act of relative sanity, Gannett shareholders have — at least temporarily — turned back MNG/Alden Global Capital's attempted hostile takeover. For Memphians, that means The Commercial Appeal avoided falling into the fire of hedge-fund ownership, though it remains a frying pan heated by economic pressure, and hedge-fund created trends. In the short run, it means we won't lose the city's historic paper of record, giving the newly right-sized and relocated newspaper an opportunity to claw its way back to relevance.

Beyond the actual vote, what followed was like a conversation from fantasy land.

Via USA Today:



Gannett Chairman [John Jeffry] Louis said the company is “laser focused on transformation” and is successfully transitioning to a business model that “positions the company to thrive in the digital future.” 

Settle down Flash Gordon! The laser-wielding chairman muddles issues and arguments, in ways a good debate team might challenge, but he's at least partly correct. Only significant digital growth isn't reclaiming segments of lost readership, and nothing is keeping pace with losses in traditional models where the bedrock of local news is going to pieces. Newspapers have been cutting their way to "sustainability" for decades now, and as a result, the products look like chemo patients, taking a cure that's also killing them. Hopes and prayers go out in the form of stories about AI, digital inevitability, and an abiding belief that we'll be saved by the same kinds of disruptions that brought us to this apocalyptic prom date.

Meanwhile, comments from MNG — a company famous for its community-be-damned, slash-and-burn roadmap to double-digit profits — read like broadcasts from Bizarro world.

Via USA Today:
“This is a win for an entrenched Gannett Board that has been unwilling to address the current realities of the newspaper business, and sadly a loss for Gannett and its shareholders," MNG said in a statement. "Gannett’s newspapers are critical local resources, and we hope that Gannett’s incumbent Board and Management shift course to embrace a modern approach to local news that will save newspapers and serve communities. That would be the best outcome. If Gannett’s Board does not shift course from overpaying for non-core, aspirational and dilutive digital deals, we believe the stock will drop further.”

HA! That's rich stuff right there. Though, who's to say in regard to the final prediction.

For the moment, Memphis is a two-daily-newspaper town. Though, one — The Daily Memphian — doesn't exist in paper form. That's weird, right? And it feels like it should be awesome. Though, between intrinsic, probably unavoidable redundancy in beats, it's difficult to measure at the moment just how much more is being covered or how much more audience is reached and influenced as a result.

Branding matters. The force with which any story lands is determined, in part, by reach, and the strength of certain social bonds. There's historic erosion in both these areas and recent redundancies.

SB 30 Episode 9: Chris Davis of the Memphis Flyer

For our show April 28, we sat down with journalist Chris Davis of the Memphis Flyer and took an in-depth look at the current landscape of the print newspaper and how we got here, based in part on Chris' great reporting for his Flyer series Justice in Journalism, and his March 14, 2019 story "Going to Pieces" (link below).

If one cares to indulge in fantasy, (as executives at Gannett and MNG clearly do) it's not that hard to picture a positive result from the almost certain disaster of MNG control. If the CA underperformed, it might be sold off locally, and relatively cheaply. Once upon a time interests behind The Daily Memphian wanted to pull off just that kind of ownership transfer, so it's not completely insane to picture some kind of triumphant restoration, with lost employees returning to old beats in new digs. Like, I said — fantasy. It's not entirely unprecedented but, as is the case with  most genie wishes, there's a price.

Like one friend on social media said, "One-and-a-half cheers for the less bad guys!" That's about right.  But I'm also reminded of Avengers: Infinity War when Drax the Destroyer tells Star-Lord he's a sandwich away from being fat. Newspapers are priced to flip these days, and now that it's been looted, the CA is one disruption away from whatever comes next.


One sentence summary: Gannett, and Memphis dodged a bullet, but the gun's still loaded. 

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