USA Today publisher Gannett climbed on Thursday after a report that it was looking to team up with Gatehouse Media, a deal that would combine the two largest U.S. newspaper chains.
Gannett (NYSE:GCI) rose to a high of $8.34 on Thursday, but the shares fell back to $7.74, up 1.4%. New Media Investment Group (NYSE:NEWM), which owns Gatehouse, rallied 6.2% to $9.13. New Media Investment Group is worth about $554 million, while Gannett has a market cap of about $887 million.
Gannett also held talks with Tribune Publishing (NASDAQ:TPCO) and McClatchy (NYSE:MNI), The Wall Street Journal reported, citing people familiar with the matter.
The latest merger fever to hit the publishing sector has been borne out of need rather than desire. With advertising dollars shifting from print to digital, newspaper publishers have faced an uphill battle to generate growth.
The news comes just months after Gannett, in January, successfully defended a hostile $1.36 billion bid from MNG Enterprises.
