[4], In 2019, Alden attempted, but failed at, a hostile takeover of Gannett. In a press release Monday, Nov. 22, 2021 Alden said it sent Lee's board a letter with the offer. This is predatory.. At the same time, he increased subscription prices in many markets; it would take awhile for subscribersmany of them older loyalists who didnt carefully track their billsto notice that they were paying more for a worse product. Hedge fund reaches $630m deal to buy remaining Tribune Publishing What's in the fine print in Alden's offer to takeover Tribune? - The Alden Global Capital already owns 200 publications and a 6% stake in Lee Enterprises. But even for a group of journalists, it was tough to keep the publics attention. On more than one occasion, according to people I spoke with, he asked aloud, What do all these people do? According to the former executive, Freeman once suggested in a meeting that Aldens newspapers could get rid of all their full-time reporters and rely entirely on freelancers. As the months passed, things kept getting worse. Eventually he was the only news reporter left on staff, charged with covering the citys police, schools, government, courts, hospitals, and businesses. The firm has a history of purchasing newspapers to cut costs wherever . After serving in the Carter administrations Treasury Department, Brian became widely knownand fearedin the 80s for his hard-line negotiating style. [10] With its acquisition of Tribune Publishing in late May 2021, Alden is collectively the second-largest owner of newspapers in the United States, as calculated by average daily print circulation, second only to Gannett. Knight first reported its investment in Alden in 2010, noting the fair market value of its Alden holdings was $13.4 million. and our desire to support local newspapers over the long term." Alden said it wants to work Lee's board of . They were very tight. Freeman has resisted elaborating on his relationship with Smith, saying simply that they were family friends before going into business together. But when I emailed his studio looking for information, I was informed curtly that the photo was no longer available. Had Smith bought the rights himself? [22] The appointees to the MediaNews board were replaced by new directors representing the stockholders group led by Alden Global Capital. Media . [14], Alden has a reputation for sharply cutting costs by reducing the number of journalists working on its newspapers. But years later, when Randy relocates to Palm Beach and becomes a major donor to Donald Trumps presidential campaign, it will make a certain amount of sense that his earliest known media investment was conceived as a giant middle finger to the journalistic establishment. Freeman was clearly aware of his reputation for ruthlessness, but he seemed to regard Aldens commitment to cost-cutting as a badge of honorthe thing that distinguished him from the saps and cowards who made up Americas previous generation of newspaper owners. Hedge fund Alden in hunt for another big newspaper chain - WKMG Aldens calculus was simple. At one point, he told me, the citys entire civil-service commission was abruptly fired without explanation; his sources told him something fishy was going on, but he knew hed never be able to run down the story. Hedge fund known for cutting journalism jobs is seeking to buy - CNN The newspaper lost a quarter of its staff to buyouts after it was acquired by Alden Global Capital in May. Some in the industry say they wouldnt be surprised if Smith and Freeman end up becoming the biggest newspaper moguls in U.S. history. The practical effect of the death of local journalism is that you get what weve had, he told me, which is a halcyon time for corruption and mismanagement and basically misrule.. Margaret Sullivan: The Constitution doesnt work without local news. Module 5- Journalism.pdf - Journalism Modules - The 5 Ws Hellman and BNP together own 46.4 per cent of Allfunds' shares. . Heath hopes the well never runs dry, but hes going to keep pumping until it does. When lawmakers pressed for details last year on who funds Alden, the company replied that there may be certain legal entities and organizational structures formed outside of the United States.. . Hedge fund Alden Global Capital, one of the country's largest newspaper owners with a reputation for intense cost cuts and layoffs, has offered to buy the local newspaper chain Lee Enterprises for about $141 million. My answer is its hard to know. Alden, which has built a reputation as one of the newspaper industry's most aggressive cost-cutters, became Tribune Publishing's largest shareholder in November 2019 and owns a 31.3% stake. It turned out that those ownersNew York hedge funders whom Glidden took to calling the lizard peoplewere laser-focused on increasing the papers profit margins. [10][19][20], The company has its origins in R.D. Hedge fund Alden to buy Tribune Publishing in deal valued at $630 In the past 15 years, more than a quarter of American newspapers have gone out of business. Tuesday, 23 November 2021 07:46 PM EST. This was the core of Freemans argument. Iowa's Lee Enterprises seeks help to fight Alden's takeover bid That's because the fund is stepping in to buy and then gut newsrooms across the country. I would know he didnt mean it, and he would know he didnt mean it, but he would at least go through the motions. Plus how Facebook is a hostile foreign power, the engineers daughter, the collapse of music genres, Dostoyevsky, W. G. Sebald, nasty return logistics, and more. Hedge fund Alden Global Capital, one of the country's largest newspaper owners with a reputation for intense cost cuts and layoffs, has offered to buy the local newspaper chain Lee Enterprises for about $141 million. Hedge fund Alden Global Capital, one of the country's largest newspaper owners with a reputation for intense cost cuts and layoffs, has offered to buy the local newspaper chain Lee Enterprises . In legal filings, Alden has acknowledged diverting hundreds of millions of dollars from its newspapers into risky bets on commercial real estate, a bankrupt pharmacy chain, and Greek debt bonds. Alden Global Capital is a hedge fund based in Manhattan, New York City. Through it all, the owners maintained their ruthless silencespurning interview requests and declining to articulate their plans for the paper. Much of the Knight family's once-grand newspaper empire was ultimately acquired by Alden Global Capital, while the family foundation invested in Alden funds. When Alden first started buying newspapers, at the tail end of the Great Recession, the industry responded with cautious optimism. As a reporter who's covered Alden Global Capital for more than two years, people often ask me who are the investors behind the hedge fund that owns one of America's largest newspaper chains?. [21], Under the acquisition plan, MediaNews Group debt fell to $165 million from about $930 million. Tribune Sale to Alden Approved by Shareholders - The New York Times Soon, Tribune-owned newsrooms across the country were kicking off similar campaigns. '60 Minutes' correspondent Jon Wertheim on local newspapers - Poynter When the journalists created a Slack channel to coordinate their efforts across multiple newspapers, they dubbed it Project Mayhem.. By the charitys own accounting, it lost $ 2.3 million in book value on a $17 million investment that year. Aldens website contains no information beyond the firms name, and its list of investors is kept strictly confidential. It emphasizes supporting the emergence of new, sustainable models for local news, through both grantmaking and research, Sherry told me, including grant programs for nonprofit news organizations. Alden Global Capital pushes to reshape Lee Enterprises board It wasn't the first newspaper acquisition for this hedge fund firm, nor is it the only firm of its kind eyeing the nation's newspapers. At the Suns peak, it employed more than 400 journalists, with reporters in London and Tokyo and Jerusalem. Newspaper publisher Lee Enterprises is asking its shareholders to help it fight off a hostile takeover . Otherwise, youre just peeing in the ocean.. Fears for future of American journalism as hedge funds flex power John Temple: My newspaper died 10 years ago. Gerry Smith. [4][5] The company added more newspapers to its portfolio in May 2021 when it purchased Tribune Publishing and became the second-largest newspaper publisher in the United States. Alden Global to buy Tribune Publishing for $630 million - Los Angeles Times This summer, Alden Global Capital acquired Tribune Publishing and its titles, from small community newspapers to major metro titles like its flagship, The Chicago Tribune, and The Baltimore Sun. "[21], shareholder rights plan, colloquially known as a "poison pill", "Alden Global Capital LLC NEW YORK , NY", "Company Overview of Alden Global Capital LLC", "Heath Freeman of Alden Global Capital says he wants to save local news. Freeman was more animated when he turned to the prospect of extracting money from Big Tech. Next year, Bainum will launch The Baltimore Banner, an all-digital, nonprofit news outlet. Clearly, for Smith and Freeman, chop-shopping their newspapers paid off. But as long as Alden had made back its money, the investment would be a success. What exactly went wrong would become a point of bitter debate among the journalists involved in the campaigns. The newsroom was moved to a single room rented from the local chamber of commerce. but sadly on a global scale there is hardly any independent news sources left currently. I sort of bully people around to get stuff done, he boasted to The Washington Post in 1985. I asked, What is the Foundations perspective on those investments now, as news of Aldens gutting of these newspapers has come to light?. A young man named Randall Duncan SmithRandy for shortstands next to his wife, Kathryn, answering quick-fire trivia questions in front of a live studio audience. The pitch had a certain romantic appeal to the reporters in the room. With its acquisition of Tribune Publishing earlier this year, Alden now controls more than 200 newspapers, including some of the countrys most famous and influential: the Chicago Tribune, The Baltimore Sun, the New York Daily News. Iowa-based Lee Enterprises asks investors to help fight off hedge fund Alden Global Capital. "[34], In October 2021, The Atlantic examined the impact of Alden's acquisition of the Chicago Tribune, noting that, "The new owners did not fly to Chicago to address the staff, nor did they bother with paeans to the vital civic role of journalism. Alden, which took Chicago-based newspaper chain Tribune Publishing private in May, said it made a proposal to buy Lee for $24 a share in cash, a 30% premium to Friday's closing price for . Several years later, when Heath was still in his mid-20s, Smith co-founded Alden Global Capital with him, and eventually put him in charge of the firm. Two days after the deal was finalized, Alden announced an aggressive round of buyouts. After a powerful Illinois state legislator resigned amid bribery allegations, the paper didnt have a reporter in Springfield to follow the resulting scandal. The Tribune had been profitable when Alden took over. Shortly after the Tribune deal closed earlier this year, I began trying to interview the men behind Alden Capital. At their worst, they used their papers to maintain oppressive social hierarchies. [2] [3] By mid-2020, Alden had stakes in roughly two hundred American newspapers. "The question is, will local communities decide that this is an important issue, that it's worth saving these newspapers, protecting them from firms like Alden, or will they decide that they don't really care?" After Brian took his own life, in 2001, Smith became a mentor and confidant to Heath, who was in college at the time of his fathers death. Over the course of seven years, Alden doubled profits in its Bay Area News Group newspapers, another home to cutbacks. In February 2021, he announced a handshake deal to buy the Sun from Alden for $65 million once it acquired Tribune Publishing. It played with my mind a little bit, Glidden told me. It's traded in a prestigious downtown newsroom for a "Chipotle-sized office" near the printing press. Longtime Tribune staffers had seen their share of bad corporate overlords, but this felt more calculated, more sinister. He says he visited the Tribune's office and was "really shocked by how grim the scene was." Located in the same Manhattan office building as Alden, it funds stem-cell research, health-related charities, arts and culture and Duke University, alma mater of Smiths protg Heath Freeman. But maybe the clearest illustration is in Vallejo, California, a city of about 120,000 people 30 miles north of San Francisco. In recent months, hes been meeting with leaders of local-news start-ups across the countryThe Texas Tribune, the Daily Memphian, The City in New Yorkand collecting best practices. In my many conversations with people who have worked with Freeman, not one could recall seeing him read a newspaper. The Banner will launch with about 50 journalistsnot far from the size of the Sunand an ambitious mandate. If you're a reader of local newspapers particularly the Chicago Tribune, The Baltimore Sun or New York Daily News you're going to want to make sure the answer is yes. Alden is known for . Alden Global Capital, the hedge fund that owns the Chicago Tribune and New York Daily News, offered to buy Lee Enterprises Inc. for about $142 million, seeking a larger share of the . [6][7][8][9], The company operates its media holdings through Digital First Media (DFM), which it acquired in 2010 after DMG's parent company, MediaNews Group, declared bankruptcy. Who Profits From Alden Global Capital? You'd be surprised. It was like watching a slow-motion disaster, says Gregory Pratt, a reporter at the Chicago Tribune. Feeling burned by the hedge fund, Bainum decided to make a last-minute bid for all of Tribune Publishings newspapers, pledging to line up responsible buyers in each market. The specific shareholder rights plan adopted by the Lee board forbids Alden from purchasing more than 10% of the company, and will be in force for one year. People who know him described Freemanwith his shellacked curls, perma-stubble, and omnipresent smirkas the archetypal Wall Street frat boy.