The decision was made in recent days after Wyss' associates examined the Tribune's finances as part of a due diligence process, according to the NYT report, which cited people with knowledge of the matter.
Wyss had come to believe it would be difficult for him to realize his ambition of transforming The Chicago Tribune, the paper he was most interested in, into a national publication, the New York Times said.
Earlier this month, Tribune Publishing received a $680 million takeover offer from Newslight LLC, a bid that trumped an earlier proposal from hedge fund Alden Global Capital for the owner of the Chicago Tribune and the New York Daily News.
Tribune said in a statement on April 5 that its board had determined that the $18.50 per share proposal from Newslight, jointly owned by Choice Hotels International Inc Chairman Stewart Bainum and Wyss, was superior to Alden's bid.
Bainum has also done due diligence on the deal and remains committed to a bid, Bloomberg reported on Saturday, citing a source.
The Bloomberg report added that Bainum is exploring alternative partnerships and financing, and has received inquiries in recent weeks from potential investors.
Tribune Publishing did not respond to a request for comment on Saturday.
(Reporting by Kanishka Singh in Bengaluru; Editing by Alistair Bell)