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Gannett Bid Could Drive Shareholder Lawsuit

USA Today publisher Gannett Co.'s (GCI) move to couple its $864 million hostile bid to acquire Tribune Publishing (TPUB) with a "just vote no" campaign against the media company's directors is an unusual and rarely employed strategy but one that could encourage a shareholder lawsuit and help drive a deal.

Specifically, on Monday Gannett hiked its hostile offer to buy Tribune Publishing to $864 million, up from a $815 million bid made last month. The move comes after Gannett on May 2nd launched a "just vote no" campaign urging shareholders to oppose Tribune Publishing's eight incumbent director candidates as part of an effort to bolster its unsolicited bid.

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The vote, which is scheduled to take place at Tribune Publishing's June 2 annual meeting, will have no binding impact on its management or board. However, a large negative vote against Tribune Publishing's directors would send a strong message that shareholders want the two sides to engage in discussions about...