Hostile Bid for Gannett Rattles Some in the Newspaper Business

Hedge fund-backed Digital First Media says costs need to be in line with revenue

Keach Hagey and

Lukas I. Alpert

Updated Jan. 14, 2019 10:35 p.m. ET

The hostile takeover bid for USA Today parent Gannett Co. by MNG Enterprises Inc., a newspaper group backed by a hedge fund, stoked fears that an industry already reeling from years of cutbacks could be in for even more severe cost-cutting as financial owners become bigger players.

MNG Enterprises, which is better known in the industry as Digital First Media, sent a letter on Monday to Gannett, the country’s largest newspaper group by circulation, revealing that it had taken a 7.5% stake in the company and proposing to acquire...