(Adds comments from Monster, Randstad)
By Michael Flaherty
NEW YORK, Sept 30 (Reuters) - MediaNews Group Inc, one of the largest U.S. newspaper companies, said on Friday it plans to nominate seven directors to replace the board of Monster Worldwide Inc, stepping up a battle against the proposed sale of the online jobs site.
The fight presents a unique case whereby a private company is proposing to overthrow a public company’s entire board through a proxy fight, a move more often associated with activist hedge funds.
Monster, based in Weston, Massachusetts, agreed in August to a $429 million acquisition offer from Dutch staffing group Randstad. The all-cash offer from Randstad, the world’s second-largest staffing company, is part of its effort to expand into the United States and into online recruiting.
Ten days after the announcement of that deal, MediaNews said it had bought an 11.6 percent stake in Monster and that it opposed the Randstad acquisition.
MediaNews repeated its concerns about the deal on Friday.
“We have significant concerns about the flawed and unorganized sale process that led to the current deal with Randstad,” MediaNews said on Friday.
Monster Chief Executive Officer Tim Yates said in a statement that MediaNews Group is trying to derail the Randstad deal and take control of the company without paying a premium.
Monster’s board recommends that shareholders tender their shares to Randstad, “which provides stockholders immediate and certain value,” Yates said.
MediaNews, whose 67 daily newspapers include the San Jose (California) Mercury News and the Lowell (Massachusetts) Sun, nominated seven directors, including Daniel Dienst, former chief executive of Martha Stewart Omnimedia, who MediaNews said it would install as Monster’s CEO if its proposed slate of directors wins.
Monster’s annual meeting has already been held, so MediaNews is launching a consent solicitation, meaning it needs to get the support of more than 50 percent of Monster’s outstanding shareholders before it can proceed with a special vote for its seven nominees.
MediaNews said in August that Monster should remain independent and boost its share price through cost cuts, the sale of assets and by adjusting its strategy.
Monster has called the MediaNews case against the Randstad offer “flawed and uninformed.”
Last week, Randstad extended the deadline for its offer to Oct. 28.
“Randstad has full confidence in its proposed transaction to acquire Monster Worldwide, Inc,” the company said on Friday. “We believe our terms deliver substantial and certain value for MWW shareholders.”
Reporting by Michael Flaherty; Editing by Bernadette Baum and Tom Brown