Tronc and Gannett are crashing on a report that banks have backed out of financing their deal

Shares of Tronc and Gannett plunged in trading on Thursday after Bloomberg reported that banks financing Tronc's takeover by Gannett have backed out.

Bloomberg's Alex Sherman and Gerry Smith reported that lenders withdrew funding on concern that both companies may be overvalued based on the deal price of about $18.75 per share.

Gannett, which owns USA Today, agreed to buy Tronc, the publisher of big city newspapers such as the Chicago Tribune and LA Times, to better compete in online news.

Deal talks are still ongoing, and both companies are working to make it happen, according to the report.

This was the plunge in Tronc shares. Trading was briefly halted for the volatility of the move lower:

And in Gannett, which fluctuated shortly after the news but was still off 13%:

More to come ...