DallasNews files preliminary proxy statement in connection with Hearst merger

DallasNews (DALN)filed a preliminary proxy statement in connection with its pending merger with Hearst, one of the nation’s leading information, services and media companies, for $15.00 per share in cash. As described in the preliminary proxy statement filing, the DallasNews Board of Directors continues to believe that the Hearst Merger is in the best interests of shareholders: clear, certain value at a 242% premium based on the closing price of DallasNews’ common stock of $4.39 per share on July 9, 2025, the last full trading day before the Board approved the merger agreement with Hearst. Importantly, Robert Decherd, the current owner of a majority of the voting power of DallasNews common stock, has agreed to vote his shares in favor of the Hearst Merger. Mr. Decherd’s support is necessary to obtain the requisite shareholder approval and thus essential to the Hearst Merger or, in fact, any similar proposed transaction. The company said, “On July 22, 2025, the Company received an unsolicited, non-binding proposal from MNG Enterprises, Inc., an affiliate of Alden Global Capital. Alden represented at the time that, “(w)e have been considering a potential transaction with DallasNews for several years,” though such purported interest had never been conveyed to DallasNews prior to July 22nd. Shortly after the Company’s receipt of the Alden Proposal, Mr. Decherd publicly confirmed his intention to honor his commitment to vote in favor of the Hearst Merger. He further stated that there is no scenario involving Alden or its affiliates as a buyer for DallasNews which he would support. Mr. Decherd’s message was clear: as long as he is the controlling shareholder, Alden will never own DallasNews. In large part due to the fact that an Alden transaction is impossible to consummate without Mr. Decherd’s approval, DallasNews announced on July 28, 2025 that the Board had reviewed the Alden Proposal and determined that it did not constitute a “Superior Proposal” as that term is defined in the Hearst Merger Agreement. Despite the insurmountable shareholder approval hurdle that Alden faces in a path to a potential transaction, Alden has now stated their intention to take their case “directly to (DallasNews) shareholders.” While their goal in doing so is unclear, for the Hearst Merger to be consummated, two-thirds of the shares of Series A common stock, voting as a single class, must vote in favor of a transaction, in addition to two-thirds of the shares of Series B common stock, voting as a single class, and two-thirds of the combined shares of Series A and Series B common stock, voting together as a single class. Mr. Decherd does not control the Series A vote, thus Alden’s ownership stake – and potential efforts to rally other shareholders against the Hearst Merger – makes it increasingly difficult for DallasNews to obtain approval of and close the transaction with Hearst. Should Alden thwart the Hearst Merger, it will have succeeded only in destroying tens of millions of dollars of potential shareholder value represented by the Hearst Merger. And while they may publicly state otherwise, Alden has no replacement transaction to offer: absent Mr. Decherd’s support, they cannot reach the requisite threshold for shareholder approval of their own deal. The proposed Hearst Merger is thus clearly the optimal path forward for DallasNews shareholders. Indeed, it is the sole path at this point that will deliver certain, premium value to shareholders.”