(Bloomberg) -- Swiss billionaire Hansjoerg Wyss will drop out of a group that was bidding for Tribune Publishing Co., according to a person familiar with the situation, dealing a setback to a $681 million takeover attempt.

Wyss had teamed up with Choice Hotels International Inc. Chairman Stewart Bainum Jr. on the $18.50-a-share offer, which topped a rival bid from hedge fund Alden Global Capital. But after conducting due diligence for the past two weeks, Wyss decided not to go forward with the proposal, according to the person, who asked not to be identified because the deliberations are private.

Wyss didn’t immediately respond to a request for comment.

The Bainum-Wyss group, which called itself Newslight, was seen as friendlier to the publishing company’s news staff, since the investors have vowed to protect local journalism. Alden, which already owns 32% of Tribune Publishing, has a reputation for deep cuts at the companies it acquires. Tribune’s newspapers include the Chicago Tribune and New York Daily News.

Bainum has also done due diligence on the deal and remains committed to a bid, said the person. He is exploring alternative partnerships and financing, and has received inquiries in recent weeks from potential investors, according to the person.

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