Glass Lewis recommends shareholders vote FOR DallasNews’ merger with Hearst

DallasNews Corporation (Nasdaq: DALN), the holding company of The Dallas Morning News and Medium Giant, announced today that leading independent proxy advisory firm, Glass, Lewis & Co. has recommended shareholders vote FOR the pending merger with Hearst, one of the nation’s leading information, services and media companies, for $15.00 per share in cash which reflects a significant premium 242% over the $4.39 closing price per share of Series A Common Stock on July 9.

John A. Beckert, chairman of the board, DallasNews, said: “We are pleased that Glass Lewis has recommended shareholders vote FOR the Hearst Merger. The Hearst Merger offers certain liquidity to shareholders and a significant all-cash premium on their investment. In addition, Hearst has a unique ability to complete the transaction, paired with a serious commitment to upholding the proud legacy of DallasNews. The Board is proud to recommend that all shareholders vote FOR this important and value creating merger.”

In its report finding that the Hearst Merger represents compelling value for DallasNews shareholders, Glass Lewis*:

• Emphasized that the Hearst Merger offers DallasNews shareholders a material premium and control valuation:
  
  “Headline value remains noteworthy here, as Hearst is currently offering investors a 242% all-cash premium and a roughly six-year unaffected high. We further note the deal-implied trailing revenue multiple of 0.54x substantially outstrips DNC's [DallasNews’] standalone unaffected average multiple for each of the three one-year periods leading to announcement (i.e. 0.10x, 0.13x and 0.26x, beginning with the most distant measurement period). We believe these considerations establish that DNC [DallasNews’] investors are receiving both a material market premium and a control valuation well in excess of the Company's standalone arc.”
  
  “…we believe the currently proposed terms with Hearst are reasonably likely to approximate the maximum value available under current market and ownership conditions.”

• Validated the fairness opinion provided by J.P. Morgan Securities LLC (“JPM”) who was retained by the company’s board as its external financial adviser:
  
  “Available disclosure indicates JPM's opinion relied principally on a DCF analysis, which methodology yielded an equity reference range of $8.10 to $8.45 per share. We note DNC's [DallasNews’] preannouncement price (i.e. $4.39 per share) falls well beneath the foregoing range, suggesting the Company may have traded at a substantial discount to intrinsic value. All the same, the revised terms from Hearst, at $15.00 per share, significantly outstrip the same range, reinforcing the notion that the proposed exit does indeed represent a material premium for DNC [DallasNews] investors.”

• Cautioned that voting against the transaction is unlikely to secure greater value from Hearst or any other party and that DallasNews shares are likely to revert to their pre-announcement levels if the Hearst Merger is not approved:
  
  “Thus, rejection here would functionally be a matter of principle, and would not chart a particularly clear path to securing greater value from Hearst or any other party, including Alden.”
  
  “…rejection of the current agreement might reasonably result in a retreat by DNC's [DallasNews’] Series A common shares to prices approximating pre-announcement levels.”

DallasNews shareholders — your vote is very important regardless of how many shares you own.

Not voting is the same as voting against the transaction. The board recommends all shareholders to vote FOR the Hearst Merger to realize certain value and a significant premium.

The voting window is closing rapidly — it is important to act now. To be certain your vote is cast by phone or internet, please vote on or before Sept. 22 at 10:59 p.m. CT.

Shareholders that have questions about voting their proxy or require replacement proxy materials, please contact the company’s designated proxy solicitors D.F. King & Co., Inc. toll-free +1 (866) 416-0577 or by email at DALN@dfking.com or Okapi Partners toll-free at +1 (844) 343-2621 or by email at Info@okapipartners.com.

*Permission to use quotations from the report was neither sought nor obtained.

About DallasNews Corporation:

DallasNews Corporation is the Dallas-based holding company of The Dallas Morning News and Medium Giant. The Dallas Morning News, a leading daily newspaper, is renowned for its excellent journalistic reputation, intense regional focus, and close community ties. As a testament to its commitment to quality journalism, the publication has been honored with nine Pulitzer Prizes. Medium Giant, an integrated creative marketing agency with offices in Dallas and Tulsa, works with a roster of premium brands and companies. In 2024, the agency earned top industry recognition, winning an AAF Addy and the AMA DFW Annual Marketer of the Year Award for Campaign of the Year, along with six prestigious Davey Awards. Medium Giant is a wholly owned business of DallasNews Corporation. For additional information, visit mediumgiant.co.