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Swiss billionaire backs out of offer to buy Tribune Publishing Co.

Tribune Tower in 2007, once the home to the Chicago Tribune. (M. Spencer Green/Associated Press)
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A Wyoming-based Swiss billionaire who formed half of the consortium making a bid to buy Tribune Publishing Co. has backed out of the deal, according to two people familiar with negotiations.

Hansjörg Wyss had joined with Maryland business executive Stewart Bainum Jr. earlier this month in submitting the $680 million proposal to a special committee of Tribune’s board, in an attempt to beat out an offer from Alden Global Capital. The development casts further doubt on whether journalists at Tribune newspapers can avoid a takeover by the hedge fund, which has a reputation for deep cost-cutting.

Bainum — who is said to still be committed to the deal to buy Tribune and is actively seeking investors to join him — informed the special committee of Wyss’s withdrawal verbally Friday night and confirmed it in writing on Saturday. A spokesman for the special committee of Tribune’s board declined to comment.

Bainum has also completed his due diligence into Tribune’s finances and found the numbers “more than satisfactory,” one of these people familiar with the negotiations said. (Both spoke anonymously because they were not authorized to comment publicly about the deal). Bainum has fielded interest from other wealthy individuals and foundations as well.

Wyss’s withdrawal represents a setback in an 11th-hour effort from wealthy investors that had been welcomed by a number of Tribune journalists. For nearly a year, many of them have been publicly campaigning for local investors to step forward and buy their publications, citing Alden’s history for gutting newsrooms and selling off real estate assets.

Nearly two weeks ago, the special committee of Tribune boards announced that the offer from Bainum and Wyss ″would reasonably be expected” to beat the preexisting offer from hedge fund Alden, valued at $630 million. But the board also reiterated its support for the Alden offer, which it previously backed.

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Tribune Publishing Co. owns several well-known newspapers across the country, including the New York Daily News, Hartford Courant and Chicago Tribune.

It also owns the Baltimore Sun and Capital Gazette in Annapolis, which Bainum attempted to buy and operate under a newly formed nonprofit in a nonbinding, $65 million side deal struck with Alden earlier this year. But after negotiations with Alden over shared services agreements collapsed, Bainum received permission from the Tribune board’s special committee to be released from a nondisclosure agreement so he could talk to investors about making an offer to buy all of Tribune’s newspapers.

Wyss had emerged as Bainum signaled he was seeking investors to join him. Apart from Wyss, other wealthy would-be investors in Florida have publicly stated interest in purchasing the Orlando Sentinel and South Florida Sun Sentinel.

Alden bought nearly a third of Tribune company stock in November 2019. Any final deal is subject to approval by two-thirds of non-Alden shareholders in a yet-to-be-scheduled vote.

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