Tegna Bidders Drop Out Following Coronavirus
Tegna Inc. on Sunday reported on recent acquisition offers. As has been widely reported, Tegna has received four unsolicited acquisition proposals in recent weeks. Tegna and its advisers engaged substantially with two of these parties and provided them extensive non-public due diligence information.
These two parties made their proposals shortly before the recent market dislocation due to the COVID-19 pandemic and both subsequently informed Tegna that they were ceasing discussions. The other two parties have not signed confidentiality agreements to enable due diligence and have not delivered any information on financing sources.
Howard Elias, chairman of the board, said: “In addition to our focus on executing our standalone plan, the Tegna Board and management have meaningfully engaged with third parties to explore opportunities to create value. The board has been, and remains, willing to consider transactions that create compelling value, and our focus now is on helping management navigate through an unprecedented environment.”
Dave Lougee, president and CEO, said: “Like every other company, Tegna is operating in uncharted waters due to COVID-19 as we focus on ensuring the health and safety of our employees while continuing to create and preserve value. High-quality local news has never been more important, and we are fortunate to have significant contractual subscription revenues and a strong balance sheet with minimal near-term debt maturities. We are working through the current challenges raised by COVID-19 and are very confident that our long-term growth drivers remain intact.”
Tegna said it “does not intend to update this disclosure.”
Standard General was not one of the companies bidding for Tegna, but has been trying to drive Tegna into the arms other another company. Its founding partner, Soo Kim, today issued this statement:
“We understand that Tegna’s process has stalled because, amid a global emergency and capital markets dislocation, this board has created arbitrary deadlines and unnecessary preconditions. By their own admission, the company has been unwilling to provide access to information unless suitors first demonstrate certainty of financing. This approach would be off market in any deal environment, and particularly so under current market conditions. The board’s actions appear designed to end this process before it can even begin in earnest.
“This is just the latest in a troubling pattern of behavior. It should never have come to this, and shareholders need to hold this board accountable.”