Gannett’s dropped Tronc bid again highlights struggles for America’s newspaper industry

America's biggest newspaper publisher has dropped its bid to buy the publisher of the Chicago Tribune and Los Angeles Times, marking an abrupt end to a chaotic corporate pursuit and casting further doubt on the country's struggling print-news industry.

Gannett, the publisher of USA Today, the Iowa City Press-Citizen and the Des Moines Register, among dozens of other media outlets, said Tuesday it had, after six months, 'determined not to pursue an acquisition” of Tronc, the publishing giant that changed its name in June from Tribune Publishing.

Tronc, which previously had rejected two Gannett bids, said in a statement Tuesday that Gannett 'has decided to abruptly terminate discussions,” and reiterating that Tronc shareholders previously had voiced 'serious doubts about Gannett's ability to finance a transaction.”

Banks that had agreed to back the deal balked in recent days after new data emerged showing deep struggles in the print-advertising business of Gannett, which has sought to survive the industry's stumbles by buying up papers in America's major markets.

But a Gannett spokesperson said the company 'had a number of financing options available” and chose to terminate discussions after considering its value to 'shareholders and whether the terms make sense for the company.”

'While we believed that the acquisition would have provided an attractive opportunity to expand the USA Today network quickly, in the end the terms were not acceptable,” the spokesperson said in a statement.

The financing tumult highlights growing worries over the future of the American newspaper business. Newspaper advertising spending is expected to hit $12 billion this year, having fallen 75 percent since the industry's $49 billion peak in 2005, data from industry researcher Magna Global show. That revenue is expected to plunge even further, to $6 billion, by 2020.

Publishers increasingly have sought to offset their weak business in print advertising by focusing more on digital subscriptions and circulation. Tronc, though, started late, and has struggled to catch up. It doubled its digital base over the last year, to more than 116,000 digital subscribers, but still counts less than 10 percent of the 1.3 million digital subscribers for the New York Times.

Tronc's internal turmoil has included bankruptcy, big leadership moves and a division of its print and broadcast operations. Tronc was set to report more details on its earnings Tuesday afternoon.

Gannett papers see 12 percent of the country's daily newspaper circulation, and Tronc papers are about 5 percent, data from the Alliance for Audited Media show. But a broad shift to digital is underway: Roughly 65 percent of USA Today's revenues now come from digital advertising.

The deal's dissolution likely will not change publishers' strategy to survive through gobbling up big peers, analysts said.