Irish poet Oscar Wilde opined in his 1899 essay, “The Decay of Lying,” that “Life imitates art far more than art imitates life.” The shortened version of Wilde’s quote — life imitates art — has become something of a go-to aphorism in the ensuing decades. But it seems to me life is no longer imitating art so much as it is imitating a reprise of Lewis Carroll’s Alice in Wonderland, and we’ve all fallen down the rabbit hole.
How else to explain the bizarre phenomenon of Fox News spending countless hours of airtime last week on the decision by the publishers of the Dr. Seuss children’s books to not reprint six titles because they contained ethnically insensitive or xenophobic content? You can easily look up the images in question online. They’re mainly racial-stereotype caricatures that were commonly used in the 1930s and 1940s, and it’s pretty understandable why the books wouldn’t be reprinted in 2021.
But that reasoning doesn’t adequately stoke the Fox News outrage machine. Nope. The real reason Seuss books are going away is because of liberal “cancel culture,” the current rallying cry of the snowflake right. To their credit, it’s a useful phrase, really, one that can be applied to almost anything that is stopped or rejected.
The Commercial Appeal, for instance, has just replaced its long-running conservative cartoon, Mallard Fillmore (which “balanced” Doonesbury), with another conservative political cartoon, Prickly City, which features the adventures of a conservative young Black woman who once fell in love with Tucker Carlson. I am not making this up. Unless Wikipedia made it up.
At any rate, letter writers to the CA are predictably complaining that lame duck (literally) Mallard Fillmore is the victim of cancel culture. The truth is less outrageous: The editors at the CA, a privately owned company, decided to pull one conservative cartoon and replace it with another one. It’s kind of like when Beverly Hill SVU (or whatever) gets the axe from CBS.
Or like when thousands of Fox viewers demanded the resignation of Shepard Smith when he came out as gay. Or was that different?
But wait, there’s more. It turns out that the ancient plastic toy, Mr. Potato Head, is also a victim of cancel culture. And also the subject of many hours of pearl-clutching commentary in conservative media circles. How dare they remove the fedora and mustache of Mr. Potato Head?! What’s next, G.I. Josephine?
It’s kind of like when conservatives went nuts and boycotted the Dixie Chicks after they criticized George W. Bush. Or was that different?
Cancel culture has also become the rallying cry of conservative Republicans on Capitol Hill. Last week, in referencing public attitudes toward COVID, President Biden said, “The last thing we need is Neanderthal thinking, that in the meantime everything’s fine, take off your mask. Forget it. It still matters.” The nerve!
Thankfully, our own Senator Marsha Blackburn was quickly on the case, defending the downtrodden Neanderthal people on Fox News: “Neanderthals are hunter-gatherers. They’re protectors of their family,” she said. “They are resilient. They’re resourceful. They tend to their own. Joe Biden needs to rethink what he is saying.”
No one had the heart to tell Marsha that Neanderthals have been extinct for a few thousand years. I mean, except for a few descendents in Congress, the ones who tried to cancel the last election. Or was that cancellation different?
Senator Ted Cruz asked Attorney General nominee Merrick Garland how he felt about cancel culture in a Senate hearing. Garland responded: “I do not have an understanding of the meaning of the term sufficient to comment.” Which sounds about right.
Shouty Ohio Congressman Jim Jordan demanded that House Speaker Nancy Pelosi hold a congressional hearing on the pressing national crisis of cancel culture. She ignored him, thereby missing a golden opportunity to schedule such a hearing and then cancel it at the last moment.
(Updated, Dec. 7) Gannett laid off 207 employees at 43 of its newspapers, Thursday and Friday (December 5th and 6th), but none of them work in the newsroom at The Commercial Appeal.
A statement released by Memphis Newspaper Guild president Daniel Connolly said: “This afternoon, management informed The Commercial Appeal staff about layoffs within Gannett. Our newsroom in Memphis is untouched. We still do not have concrete information from the company about potential job cuts in other departments, including advertising, or among managers not covered by the Guild.”
The Knoxville News Sentinel, which lost a business reporter, a marketing employee, and its publisher/president, is the only Tennessee paper so far affected by the layoffs.
In November, GateHouse Media Inc., which published 144 daily newspapers, merged with Gannett, which made the company — which kept the Gannett name — the largest newspaper corporation in the United States. It now owns 263 local dailies across 47 states, as well as Guam, including Gannett flagship, USA Today.
For an updating breakdown of all Gannett layoffs nationwide, and the papers affected, go here.
Sunday, the rains came — in a measurable amount for the first time since early August. September had seemed like an extension of summer dog days, with the heat lodged in the mid-90s under cloudless skies, day after day. The ground was scorched and dusty and hard as bone. But Sunday afternoon, the rains finally came — in a noisy, unruly downpour that sustained itself overnight and into the next morning.
On Monday, coffee made, I walked outside in a rain jacket, squishing across my soaked lawn to pick up the Commercial Appeal, knotted into its tiny plastic bag, sealed against the elements. I returned with wet bare feet and the feeling that fall had finally pushed its way into town.
The morning paper was thin and filled with news I’d mostly read online — sports scores I already knew and not-timely analysis from Saturday’s contests. But game analysis is game analysis, and who doesn’t like reading about their team when they win? Go, Tigers.
I can’t help it. I like a newspaper with my coffee, a ritual I can’t seem to let go of, even though the Chess Quiz guy died and that feature hasn’t been replaced, and even though I’m seldom unable to resist Word Jumble, which occupies more minutes than it should sometimes: NROPE, AZUEG, AUNAGI, HRETIM. The six-letter ones are harder.
And I like some of the CA‘s young reporters — Desiree Stennett, Micaela Watts, Jason Munz, to name three. I think the local coverage is getting better and is pretty solid, most of the time. I learn enough to keep my subscription rolling, despite the paper’s absurd print deadline.
I poured another cup of coffee and checked my email and saw the morning notice from the Daily Memphian. I went to their website and read as much as I wanted to. The DM has the best sports writing in town, for my money ($7 a month), but the utter lack of national news keeps it from being a full news source of record and gives it something of a small-town paper feel. I do think it’s a necessary read for anyone wanting to keep up with what’s going on in the city.
Then I checked Twitter — where the news begins and where the reaction to it is gratifyingly instantaneous. That’s mostly because of President Trump, who drives the national news cycle with his tweets — mostly to our detriment. Still, if you’re a news junkie and you’re not following newsmakers, pundits, journalists, and, yes, the president, on Twitter, you’re doomed to reading secondhand news, after it’s been through the spin filters.
The night before, Sunday, I’d been startled to read a tweet out of nowhere from Trump that stated he had decided to pull U.S. troops from Syria after talking to the president of Turkey, leaving our allies in the fight against ISIS — the Kurds — mostly defenseless against soon-to-invade Turkish forces. It seemed like a terrible idea.
On Monday morning, the critics agreed, including a number of Republicans who saw Trump’s move as impulsive, ill-considered, and a betrayal of a loyal ally. Even Senator Lindsey Graham, who has morphed into a groveling supplicant of the president since John McCain’s death, called Trump’s move “shortsighted and irresponsible.”
He added (on Fox News!): “This impulsive decision by the president has undone all the gains we’ve made, thrown the region into further chaos. Iran is licking their chops. And if I’m an ISIS fighter, I’ve got a second lease on life.”
The president, ever-sensitive to criticism, tweeted in response: “As I have stated strongly before, and just to reiterate, if Turkey does anything that I, in my great and unmatched wisdom, consider to be off limits, I will totally destroy and obliterate the Economy of Turkey (I’ve done before!).”
And America went nuts — retweeting the president’s comment, mocking it, marveling at it, using it as a punchline, creating memes about “great and unmatched wisdom,” etc. — as America does, these days. So it goes.
I have little doubt that Graham will be back under Trump’s skirt soon, and that the seemingly endless deluge of appalling news and the flood of whistle-blown malfeasance and noisy political bloviating will continue — until whatever fate awaits us in these stormy times comes to pass. Make no mistake: A reckoning of some sort is coming. It is as inevitable as the change of seasons, as unavoidable as an overdue downpour on bone-dry ground.
New Media Investment Group, parent company of GateHouse Media, and Gannett, the corporation that currently owns and publishes the Memphis Commercial Appeal, have announced a merger.
A New Media Investment Group spokesman said that the company had arrived at an agreement to acquire Gannett (GCI) for a combination of stock and cash. Gannett publishes USA Today, in addition to many well-known local newspapers, including most major Tennessee dailies. GateHouse Media operates in 612 markets in 39 states.
According to the press release announcing the merger, Gannett shareholders will own 49.5 percent of the new company, and New Media shareholders will own 50.5 percent.
The deal is reportedly worth $1.38 billion. The combined company will be called Gannett and will be based at Gannett’s headquarters in McLean, Virginia. The merger means that the new company will own around one-sixth of all newspapers in the United States.
The press release said the merger will mean estimated annual savings of around $275 to $300 million and would help the new Gannett save on technology and human resources, and accelerate its “digital transformation.” Saving on “human resources” has often meant layoffs in newspaper company mergers.
“We believe this transaction will create value for our shareholders, greater opportunities for our employees, and a stronger future for journalism,” said Michael Reed, chief executive of New Media.
Daniel Connolly, president of the Memphis Newspaper Guild at The Commercial Appeal said: “Here in Memphis, we haven’t had a chance yet to meet and discuss the merger news as a local labor union, though I know from talking with some of our members individually that they’re very interested in it.
The obvious question is whether we’ll have additional job cuts here in Memphis. Right now, we don’t know.
At the national level, The NewsGuild leadership is following this issue very closely and studying what it means for our unions and employees. We’ll need to get a briefing on this merger from the subject-level experts who are reviewing it, and we may be able to stake out a more definite position once we learn more.”
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.
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.
“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.
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).
Gannett Shareholders Reject MNG Nominees, Avoiding Takeover For Now (2)
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.
After I spread The Commercial Appeal on my kitchen table Tuesday morning, the first thing I read was reporter Daniel Connolly’s story on Criminal Court Judge Jim Lammey, who, it appears, is quite the racist. Lammey posted articles on Facebook that called Muslims “foreign mud,” criticized the school “integration craze,” and said, Jews should “get the f—k over the Holocaust.”
Connolly reported that Lammey shared numerous articles and memes of this sort on his Facebook page. Lammey said he accidentally switched his posts to public. Oops. Just the kind of guy you want making decisions about immigrants, right? Which, among other things, is exactly what Lammey does. He did say his best friend was Jewish, so there’s that. Go read the story. It’s nauseating.
This is the part where I tell you that if it weren’t for a local journalist doing some solid reporting, I wouldn’t have known any of this. And if you didn’t read the CA, you wouldn’t have known about it either, until you read this column. The larger point being, stories like this one are why local journalism matters, now more than ever. Without journalists, those who hold public office can get away with just about anything — with your taxpayer dollars picking up the tab.
For another example, read Jackson Baker’s column this week on how fallout from the state’s absurd school-voucher bill could impact Shelby County’s 2020 budget. Where else can you find reporting from someone who spends a couple of days a week in Nashville covering the legislative clown show, then returns to Memphis to cover the county commission? Nowhere but the Memphis Flyer.
There’s also fine local reporting coming from The Daily Memphian website, and at several local nonprofit reporting organizations. They’re all important. They’re all vital to a well-informed citizenry. Give them your support and your money (cough, support.memphisflyer.com). It’s a small amount compared to what a couple of crooked officials can cost you, or a boondoggle geared to a politically connected developer, or, well, you name it. There are any number of ways those in power can quietly utilize public funds for mischief.
It’s the press’ job to keep that mischief in check by bringing it into the light, which is why a report from the Governing.com website this week is so troubling. As the report states: “One in five Americans now lacks regular access to local media coverage. Studies show this is bad for politics, municipal debt — and even the environment.”
In 2018, more than 2,000 journalists lost their jobs, a trend that has been ongoing for more than a decade: “… newspaper closures and declining coverage of state and local government in general have led to more partisan polarization, fewer candidates running for office, higher municipal borrowing costs, and increased pollution.”
That’s a hell of a laundry list. More from the report: “Since 2004, some 1,800 newspapers have closed entirely. … In many other places, newspapers are ‘ghosts’ of their former selves. … Nearly half the counties in the U.S. have only one newspaper.”
And as local media coverage dies, the void gets filled by national news and opinion, most of it spread through social media; that’s all those links to politically charged stories that appear on your friends’ Facebook pages. And that means we are becoming less informed about local issues — the ones that affect us the most — and less engaged with local government. The corollary is that we’re more engaged with national issues, which has led to more political polarization — why you now get in internet fights with that guy you used to like in high school.
Making matters worse is the fact that more and more people (including nine out of 10 Republicans!) don’t trust the media. The mantra of “Fake News!” is taking its toll. And we’re all the worse for it.
But no matter how often a certain president says it, the press is not “the enemy of the people.” Quite the contrary. America’s Founding Fathers made freedom of the press a part of the First Amendment, and there’s a reason it was the first. An uneducated and uninformed public is more vulnerable to demagoguery and more easily manipulated. So, please support your local press. It’s more important now than our forefathers could ever have imagined.
I recently visited WYPL FM for a conversation about Memphis media with Storyboard Memphis publisher, Mark Fleischer. Though the interview was inspired by Going to Pieces, a Memphis Flyer cover story about the state of print media in Memphis, we stumbled down some deep rabbit holes in a detailed account of how daily newspapers like The Commercial Appeal lost revenue, relevance, and readers they are unlikely to reclaim.
I’m honestly not sure that I ever really answered any of Mark’s questions, but we cover a lot of history, and context that’s not addressed in the original reporting so I wanted to flag the interview for interested readers.
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).
Today’s terrible journalism news: Gannett newspapers saw fourth-quarter losses in circulation and revenue. According to Marketwatch the company is reporting a 12 percent dip in sales, with circulation revenue dropping 9 percent and print advertising dropping 24 percent. The one area where Gannett has been growing also took a hit as “digital advertising and market services declined about 3 percent.”
I’ve been anticipating this news since all three of Gannett’s major Tennessee newspapers individually announced changes framed as big improvements to their editorial pages. Those changes, like the disappointing quarterly report, fit a pattern and seem to be part of a downward trend with no bottom in sight.
Gannett newspapers across the state of Tennessee, including The Commercial Appeal, have run similar editorials letting readers know they are “listening.” They’ve heard you and are, per you, developing new and improved strategies for kinder, more inclusive opinion journalism.
Redesigns can be a good thing and the print real estate traditionally reserved for unsigned editorials and nationally syndicated columnists, absolutely should be reappraised. At the same time, relinquishing the former has to also be seen as the final gasp of an era when local and regional newspapers had (or believed they had) some weight to throw around — when thick bundles of newsprint stacked as high and wide as you could see stood in evidence. But as the marketplace of ideas flattens into the marketplace, the land and physical assets these once powerful newspapers own and occupy, are seen as possessing more immediate value than either the medium or its message.
Gannett Tennessee’s new editorial plan, as variously/similarly described in its Knoxville, Nashville, and Memphis papers, includes weird Aristotelian ideals for letters to the editor which, in accordance with natural law, should not exceed 200 words in the west, 250 words in the center, and 300 words in the east of the state. The columns also suggest we’ll be seeing less national political commentary and “more about solutions than takedowns of the people and organizations trying to do things,” whatever that tragically vague construction means. Of course people and their sense of place/community matter very much, as they often do in communications seeking to persuade people who live in places and communities. Obviously, there will be more local stuff! And there will be more you!
Via the CA:
“By tradition, opinion has long been the section where readers found the institutional view of The Commercial Appeal. It is also where you read guest commentaries, local and syndicated columnists, letters to the editor, editorial cartoons and, of course, the daily Bible verse.
Starting this week, we are moving away from that approach to one that showcases more community voices, puts an emphasis on analysis and an expanded newsroom engagement with Memphis through community events we sponsor.
Readers have repeatedly told us that they want to see more locally produced guest commentaries and letters to the editor. And we want to deliver more of what you want.”
What also has to be understood, whether it’s spelled out or not, is that all this “more” is the direct result of newsrooms constantly struggling to produce a viable product with less.
The “different but same” nature of Gannett’s editorials makes it hard to take their grass roots too seriously. As a rule, newspapers have always cast a wide net but walked a narrow path, as they’ve attempted to attract and inform readers while also being an exciting, activated, and (most importantly) safe place for advertisers. Not to mention the fact that, newspapers have frequently listened to consumers and then intentionally adapted away from their needs/demands in a misguided effort to attract lost and non-readers. This was always done with full awareness that it made bundled distribution less attractive to the same loyal, long-suffering consumers that sustained newspapers when changing technology screwed all distribution and revenue models. Naturally, we’ll observe more content shifts reflecting the relative value of newspaper properties as measured against their tangible assets or lack thereof.
This pic used to help generate clicks, but now I think it makes people think they’ve already read the post. Economies, content, etc.
Unbundling content is easily justified on a spreadsheet. Art columns, for example, may be well read, but they aren’t given the importance of public affairs reporting (which isn’t prime for advertisers), and when it comes to straight clicks, little can compare to food and beverage columns. Restaurants and national food/drink brands buy ads, so if you’re a business major working for a holding company that owns a bunch of newspapers, it makes total sense to calculate the small number of readers you’ll lose completely by eliminating arts coverage as long as you can effectively sell the perceived public value of hard news while expanding popular dining and related soft/syndicated news. In another example, as page counts dwindle in print space, and digital content is prioritized, sports sections may run trend stories or business/recruiting analysis instead of next day scores and review. Similarly, election results may go digital-only, etc. But as more diverse, professionally created content is stripped away in favor of paid, nonprofessional, or owned off-market content, it becomes evident that the bundle is/was exponentially more useful and valuable than any particular sets of content. And by “the bundle,” I don’t just mean box scores, election results, stories about street names, horoscopes, and housing, I’m also counting newsprint’s famously pejorative applications as fire-starter, birdcage liner, and hand prop for would be demagogues.
To borrow from the Columbia Journalism Review, “Despite all the flaws of the traditional newspaper — and there are many — the bundling of hard news and civic information with soft news, sports, comics, and more is amazingly effective at supporting broad-based political and civic engagement.”
“From 2008 to 2009 civic engagement declined more sharply in Denver and Seattle than in other major cities—a result he attributes to the closures of the Rocky Mountain News and The Seattle Post-Intelligencer during that period, which left them as one-newspaper towns. His conclusions are consistent with a 2013 study in the Journal of Media Economics, which similarly found that after The Cincinnati Post closed in late 2007, electoral competition and voter turnout declined in areas of Kentucky where the Post was the leading paper. It’s hard to prove a direct causal connection between the papers’ closings and reduced engagement, but other research has found that residents of areas where the newspaper market doesn’t match up well with congressional district boundaries were less informed about their representatives, which in turn caused legislators to be less responsive to their constituents’ needs.”
So, you’re a Gannett newspaper in Tennessee and your “readers have repeatedly told [you] they want to see more locally produced guest commentaries and letters to the editor.” Have they? What a wonderful coincidence these super-thoughtful consumers are demanding such cost-effective (mostly free) content! Clearly Gannett, you have raised them right.
Consumer habits are no big mystery, so it’s no insult to observe that allowing the public’s interests determine public interest is like letting a toddler determine household nutrition standards. It’s also bad business for companies who aren’t nihilistically calculating managed blood loss against short-term profit. As an aside, and regardless of whether or not pulp has a future, this last bit touches on one of the reasons why fully digital models for local general daily news delivery, are still a sketchy proposition. Using both the digital-forward CA and Daily Memphian as examples, what’s on offer is a basic selection of popular content (food/business/sports) and the kind of hard news everybody used to know about due to the social function of widely circulated newspapers, but which relatively few people may actually read/subscribe for.
As a perceived public good, journalism’s power/value has always exceeded the technical reach of public affairs reporting and consumer advocacy. In other words, when newspapers were widely circulated, nobody had to actively consume hard news or advocacy to benefit from it. Going forward, this age-old assumption has to be modified to exclude deep familiarity, and with the understanding that presumed universal benefits for non-readers fade when techno/economic scales tip and enough non-readers can also be described as non-subscribers/consumers. This will be especially so in the absence of strong reciprocity and community engagement. Like newspaper properties whose practical worth is now weighted against tangible assets, once credit is lost, you’re discredited.
Hail Caesar: Gannett Papers Announce Changes in Opinion Strategy
The clip linked above is from the movie Hail Caesar. In it, you’ll see George Clooney, dressed as a Roman soldier for his role in a manufactured religious epic. He’s been kidnapped by a gaggle of weirdo communist writers who tell him that a man who understands economics and history can accurately predict the future. Now I don’t claim any extraordinary insight into either of these fields, or any gift for precognition. But I did, rather flippantly, predict this change in direction, while ranting about newspaper history and economics, and their relationship to a controversial opinion column published in several of Gannett’s Tennessee newspapers. I regret that the political-sounding headline, “MAGA Bro Pens Love Letter to MAGA CAP,” may have kept some from reading media criticism that anticipates how modern economies and user habits will eventually yield more populist, probably non-professional content.
Gannett Co. leaders said they remain skeptical of MNG Enterprises’ $1.8 billion offer to buy the newspaper company after a meeting late last week.
MNG made an unsolicited offer to buy Gannett, the corporate owner of The Commercial Appeal, last month for $12 per share, or $1.8 billion. Gannett leaders said they first learned of the offer in a story in The Wall Street Journal. Gannett leaders rejected the offer a week ago, claiming MNG failed to provide details on financing the deal, antitrust issues, and more.
MNG, a company also known as Digital First, is owned largely by a New York hedge fund, Alden Global Capital. Digital First operates The Boston Herald and The Denver Post, according to USA Today. MNG owns a 7.5 percent stake in Gannett.
Leaders from both companies met on Thursday, according to a news release from Gannett Monday morning, to hammer out details. But the information given in that meeting was “deficient” and did not convince Gannett leaders, the newspaper company said.
“We are disappointed that at the meeting on February 7, MNG again failed to provide substantive answers to the basic questions Gannett has repeatedly raised,” Jeffrey Louis, Gannett’s board chairman, said in a statement. “Instead, MNG offered vague and generic statements that further confirmed the board’s decision to reject MNG’s proposal.”
Here are some details from the meeting, according to Gannett:
• MNG said it would fund the deal with debt financing.
• MNG had not secured the financing, nor had it contacted potential financing sources.
• MNG offered ”vague assurances” and said that it is not concerned about antitrust issues.
• MNG said the transaction would be a merger, “not the acquisition proposal that MNG had previously put forth.”
“Despite being afforded every opportunity to provide Gannett with specifics related to these important matters, [R. Joseph Fuchs, executive chairman of MNG] refused to provide any substantive, actionable evidence of a credible proposal,” reads a Gannett statement.
POSSIBLE HOSTILE TAKEOVER
During a break in these talks, MNG told Gannett leaders that the company intends to nominate six MNG-affiliated candidates to Gannett’s board of directors during the next shareholder meeting. That board will shrink to nine members during that meeting. Filling the board with MNG candidates could amount to a hostile takeover of the company.
“Gannett believes MNG’s clearly conflicted nominees are not in a position to fairly, and in a disinterested way, evaluate and advise Gannett shareholders on MNG’s proposed transaction,” reads a Gannett news release.
Three of the MNG candidates my not be legally capable of serving on the Gannett board, Gannett said, given their roles at MNG. Another, the 78-year-old Fuchs, exceeds Gannett’s mandatory retirement age for board members.
”MNG’s acknowledgement that these nominations are indeed intended to advance its efforts to acquire Gannett further underscores the proposed nominees’ clear and irreconcilable conflicts of interest and inability to satisfy fiduciary responsibilities to all Gannett shareholders,” said Louis.
Gannett Co.’s board of directors unanimously rejected MNG Enterprises’ offer to buy the company, calling the proposal “not credible” and saying it undervalued Gannett.
MNG proposed buying the newspaper company, owner of The Commercial Appeal, earlier this month, in an unsolicited deal worth $12 per share. The move left many to worry that the company would lay off even more staff at Gannett papers to drive profitability.
But Gannett board chairman Jeffry Louis said the board is optimistic about the company’s future and its digital strategy.
“Our board of directors is confident that Gannett has significant value creation potential,” Louis said in a statement. “Our vision and pursuit of our digital transformation, combined with our USA Today Network strategy, enables us to serve more directly and efficiently the persistent demand of our audiences and customers to engage with their communities.
“We believe that our future — and that of the industry — turns on thoughtful investments in journalism and marketing solutions, so we can deliver engagement when, where, and how our audiences and customers demand it. Delivering on this purpose will deliver value to our shareholders and benefit the communities we serve.”
“We know there are challenges that face us and our industry. We firmly believe, however, that given our operational expertise, our focus on evolving our business model, and our unwavering commitment to remaining a trusted source of news, we are uniquely positioned to grow this company and its valuable assets.”
[pullquote-1] A news release from Gannett early Monday morning provided some interesting details of the deal proposed by MNG. The company’s actions — before and since its public proposal — “suggest that MNG’s proposal is not credible,” according to Gannett.
MNG did not talk to Gannett officials before a story of the offer appeared in The Wall Street Journal. Gannett received a letter from MNG a day after the story ran, even though “MNG and Gannett management are well known to one another and in fact are partners in significant operations.”
MNG did not give Gannett any information on how it would finance the deal and “failed to address potential regulatory risks and other fundamental issues that Gannett considered important.” Gannett leaders did meet with MNG officials but left with unanswered questions.
“Gannett posed questions to MNG that are routinely addressed by someone making a credible, public, unsolicited takeover proposal: Can MNG fund it? Can MNG close it?” according to Gannett.
[pullquote-2] Without the information, Gannett leaders said they felt uncomfortable signing a non-disclosure agreement with MNG. Gannett said they asked for written responses to questions that would not have required MNG to disclose confidential information. But MNG would not give them any more information about how it would execute the deal.
“In light of this, Gannett now questions MNG’s motives and can only conclude that the proposed nondisclosure agreement is a distraction designed to mask MNG’s inability to finance and complete the proposed transaction,” reads Gannett’s news release. “Indeed, given MNG’s refusal to provide even the most basic answers to Gannett’s questions, it appears that MNG does not have a realistic plan to acquire Gannett.”
Storyboard/WYPL 
Justin Fox Burks 