NEW YORK (TheStreet) --American media company Gannett (GCI) announced today that it will be dropping its bid to acquire Chicago-based newspaper Tronc (TRNC) for the price of $18.75 per share of Tronc stock.
"Gannett's financing became squishy and its board of directors started to express real concern about a potential deal in light of consecutive quarters of soft finances at the company, and so it withdrew," CNBC's David Faber said during Tuesday's "Squawk Alley."
The increasing uncertainty over financing the deal, coupled with the weak financial performances in previous quarters at Gannett, seemed to cause the withdrawal.
"In fact when these two companies began talking, Gannett's stock price was far higher than where it ended up at," Faber added.
However, there are some who wonder why Gannett didn't seek out other financial institutions willing to finance the deal.
"There are those who believed that the synergies that would have accrued to the combined company as a result of a combination would be positive for both shareholder bases," Faber noted.
Shares of Gannett were higher, while shares of Tronc were plummeting 15.46% to $10.17 in late morning trading on Tuesday.