Former Knight-Ridder headquarters. These include the Chicago Tribune, the New York Daily News, and The Baltimore Sun. One known investor, however, is the Randall and Barbara Smith Foundation, named for Alden founder Smith and his wife. 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. To find the papers current headquarters one afternoon in late June, I took a cab across town to an industrial block west of the river. Connecting this to the current state of American newspaper ownership seems rather tenuous.. 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. Another ex-publisher told me Freeman believed that local newspapers should be treated like any other commodity in an extractive business. After a contentious presidential race and amid a still-raging pandemic, there was a limited supply of outrage and sympathy to spare for local reporters. He had spoken on this issue before, and it was easy to see why. Aldens Distressed Opportunities Fund was launched in 2008 and saw astounding success in its first few months, showing returns of more than 30 percent a big rescue for Alden, whose investments in Russia the year before had lost more than 61 percent of their value. My question was did Knight know what Alden was doing to newspapers when it invested with the hedge fund, and does it regret that investment now? Digital First Media - Wikipedia The shows premise pits two couples against each other for the chance to win a home. Coordinated by . The rationale offered by the board was, Consistent with its fiduciary duties, Lees Board has taken this action to ensure our shareholders receive fair treatment, full transparency and protection in connection with Aldens unsolicited proposal to acquire Lee. Its not as if the Tribune is just withering on the vine despite the best efforts of the gardeners, Charlie Johnson, a former Metro reporter, told me after the latest round of buyouts this summer. . Gerry Smith. Over the course of seven years, Alden doubled profits in its Bay Area News Group newspapers, another home to cutbacks. The hollowing-out of the Chicago Tribune was noted in the national press, of course. On the surface, the answer might seem obvious. But there are some clues here and there. This once-proud publication is now owned and run by Alden Global Capital, a multibillion-dollar hedge fund with a long record of buying papers on the cheap, selling off their assets and slashing pay and jobs. Fears for future of American journalism as hedge funds flex power Heath hopes the well never runs dry, but hes going to keep pumping until it does. But for that to happen, the Big Tech money would need to flow to underfunded newsrooms, not into the pockets of Aldens investors. Hedge fund Alden Global is buying newspaper chain Tribune Publishing - CNN On Monday, Dail Other large shareholders include Californian asset manager Capital Group and UK fund manager Jupiter Asset Management. He writes a weekly column called Mugger that savages the citys journalists by name and frequently runs to 10,000 words. 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. It was clear that they didnt care about this being a business in the future. 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.. ", "The most feared owner in American journalism looks set to take some of its greatest assets", "Minority shareholder sues Denver Post parent and NY hedge fund over 'breaches of fiduciary duty', "What does the Chicago Tribune sale mean for the future of newsrooms? Even in a declining industry, the newspapers still generated hundreds of millions of dollars in annual revenues; many of them were turning profits. Some in the city started to wonder if the paper was even worth saving. Alden, a New York City-based firm that has become the grim reaper of American newspapers, had recently increased its stake in Tribune Publishing to 32%making it the largest shareholder of the . Have you heard of the hedge fund Alden Global Capital? But he has a big idea: He believes theres serious money to be made in buying troubled companies, steering them into bankruptcy, and then selling them off in parts. Coppins notes that there's even some research indicating that city budgets increase as a result, because corruption and dysfunction can take hold without a newspaper to hold powerful people to account. The newspaper lost a quarter of its staff to buyouts after it was acquired by Alden Global Capital in May. Some have even suggested that this represents Americas last chance to save its local-news industry. You could look to Oakland, California, where the East Bay Times laid off 20 people one week after the paper won a Pulitzer. In the Hyatt meeting, Ted Venetoulis, a former Baltimore politician, advised the reporters to pick a noisy public fight: Set up a war room, circulate petitions, hold events to rally the city against Alden. [3] [4] With its acquisition of Tribune Publishing in late . [4][13], In November 2021, Alden made an offer to Lee to purchase the company in its entirety for roughly $141 million. Its a hedge that went and bought up some titles that it milks for cash.. Or to Denver, where the Posts staff was cut by two-thirds, evicted from its newsroom, and relocated to a plant in an area with poor air quality, where some employees developed breathing problems. Through it all, the owners maintained their ruthless silencespurning interview requests and declining to articulate their plans for the paper. Freeman, meanwhile, would later gloat to colleagues that Bainum was never serious about buying the newspapers and just wanted to bask in the worshipful media coverage his bid generated. Lee Enterprises holds off an Alden takeoverfor now 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. The Hedge Fund Vampire That Bleeds Newspapers Dry Now Has the Hellman and BNP together own 46.4 per cent of Allfunds' shares. The editor in chief mysteriously resigned, and managers scrambled to deal with the cuts. Senior lenders under the deal were to swap debt for stock. The Tribune Tower, the iconic former home of the Chicago Tribune, seen in Chicago, Illinois in 2015. "[26] Shortly thereafter, Alden Global, through its operating unit Strategic Investment Opportunities, filed a lawsuit in state court in Delaware against Lee Enterprises. To him, its the same as oil, the publisher said. As a privately held hedge fund, Alden doesnt have to reveal much to the public. [32], The company has been criticized for investing money for pensions of newspaper employees in funds it manages itself. In 2016 (year of the most recent 990 available), the foundation invested $17 million in Alden funds. But as long as Alden had made back its money, the investment would be a success. But that's not true for all of them. It played with my mind a little bit, Glidden told me. But he says the worst culprit is the hedge fund Alden Global Capital, which bought the Mercury in 2011 and has since sold the paper's building and slashed newsroom staff by about 70%. Alden Global Capital is buying and gutting local newspapers : NPR - NPR.org Why Chicago Tribune Staffers Are Terrified Of Their Hedge Fund - Forbes [4] [5] The company added more newspapers to its portfolio in May 2021 when it purchased Tribune . Two days after the deal was finalized, Alden announced an aggressive round of buyouts. [13], In response, the board of Lee Enterprises enacted a shareholder rights plan, colloquially known as a "poison pill", in order to ward off the purchase attempt. And that has consequences for democracy, as journalist McKay Coppins writes in The Atlantic. Hedge fund Alden Global Capital in hunt for Lee Enterprises newspaper Alden Global Capital, a hedge fund known for gutting local newsrooms, is seeking to buy Lee Enterprises (LEE), a publicly traded company with a chain of daily newspapers and other publications . 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. It feels like were going up against capitalism now, Lillian Reed, the reporter who helped launch the Save Our Sun campaign, told me. After weeks of back-and-forth, he agreed to a phone call, but only if parts of the conversation could be on background (which is to say, I could use the information generally but not attribute it to him). 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. A more honest argument might have claimed, as some economists have, that vulture funds like Alden play a useful role in creative destruction, dismantling outmoded businesses to make room for more innovative insurgents. But by 2014, it was becoming clear to Aldens executives that Patons approach would be difficult to monetize in the short term, according to people familiar with the firms thinking. Alden is known for . This all seemed especially relevant considering many Alden/DFM papers were previously part of the Knight-Ridder chain, the family news empire from which the foundation sprang. In the face of that setback, Alden said it would turn to the tactic of filing a proxy statement asking the company's shareholders to vote no on board members Mary Junck and Herbert Moloney during the March 2022 board elections. When John Glidden first joined the Vallejo Times-Herald, in 2014, it had a staff of about a dozen reporters, editors, and photographers. Alden Global Capital, the New York hedge fund that bought Tribune Publishing this year, said on Monday that it was making an offer for another big American newspaper chain, Lee . The Tribune Tower rises above the streets of downtown Chicago in a majestic snarl of . Two veteran journalists from the Chicago Tribune published an op-ed on Sunday challenging one of the paper's principal owners, the New York hedge fund Alden Global Capital. He was fired after criticizing Alden in a Washington Post interview. Even as Aldens portfolio grew, Freeman rarely visited his newspapers. In 2011, Paton launched an ambitious initiative he called Project Thunderdome, hiring more than 50 journalists in New York and strategically deploying them to supplement short-staffed local newsrooms. So I was more than a little shocked to learn that, according to its tax filings, Knight had invested $13 million with Aldens Distressed Opportunities Fund by 2010 and kept investing through 2014. [27] The Alden lawsuit asserts that the members of the Lee board "have every reason to maintain the status quo and their lucrative corporate positions" and that they are "focused more on [their] own power than what's best for the company. His editor cited a supposed journalistic infraction (Glidden had reported the resignation of a school superintendent before an agreed-upon embargo). Baltimore has always had its problems, he told me. At one point, I tracked down the photographer whod taken the only existing picture of Smith on the internet. A spokesman took issue with the entirety of the story, and laid out a long list of questions attacking the integrity of the reporter, The Atlantic and some of his sources without addressing some of the more specific claims within the report. [29] This attempt also failed, as shareholders returned both directors to the Lee board despite Alden's opposition. It makes me profoundly sad to think about what the Trib was, what it is, and what its likely to become, says David Axelrod, who was a reporter at the paper before becoming an adviser to Barack Obama. Reinventing their papers could require years of false starts and fine-tuningand, most important, a delayed payday for Aldens investors. Lee, which owns the St. Louis Post Dispatch, the Omaha World-Herald and many other daily newspapers throughout the region, is staving off a takeover attempt by Alden Global Capital, a New-York . Several interim executive positions were also filled by people related to Alden or its parent, Smith Management LLC.[23]. "[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. No response came back. 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. Feb 16, 2021 at 8:05 pm. Ken Kelleher is an American sculptor. 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. When he did, he exhibited a casual contempt for the journalists who worked there. Some expressed exasperation with the staff of the Chicago Tribune, who were unable to find a single interested local buyer. Im repulsed by the incestuous world of New York journalism, he tells New York magazine. They could be vain, bumbling, even corrupt. The Tribune Company (which owns the newspapers mentioned above) was still turning a profit when Alden bought it, but the hedge fund immediately offered aggressive rounds of buyouts and shrunk its newsrooms in the name of increasing profit margins. 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 . A Secretive Hedge Fund Is Gutting Newsrooms. [2] Its managing director is Heath Freeman. Alden Global to buy Tribune Publishing for $630 million - Los Angeles Times At the Suns peak, it employed more than 400 journalists, with reporters in London and Tokyo and Jerusalem. [33], Alden Global Capital's management of American newspapers has been criticized. Some in the industry say they wouldnt be surprised if Smith and Freeman end up becoming the biggest newspaper moguls in U.S. history. You have no way of knowing that if you dont have some nosy son of a bitch asking a lot of questions down there, he told me. The consequences can influence national politics as well; an analysis by Politico found that Donald Trump performed best during the 2016 election in places with limited access to local news. What threatens local newspapers now is not just digital disruption or abstract market forces. Daily News spinoff stirs anxiety after Alden takeover - New York Post Hedge fund Alden Global Capital in hunt for big newspaper chain Lee The purchase represents the culmination of Alden's years-long drive to take over the company and its storied titles . Craigslist killed the Classified section, Google and Facebook swallowed up the ad market, and a procession of hapless newspaper owners failed to adapt to the digital-media age, making obsolescence inevitable. Hedge fund Alden Global Capital will acquire the rest of what it does not already own of Tribune Publishing, owner of the Chicago Tribune, the New York Daily News and other local newspapers, in a . This company that owns us now seems to still be prettyI dont even know how to put it, the editor said, according to a recording of the meeting obtained by The Atlantic. The Denver Post has become the face of this struggle, due to an editorial published in its own pages lashing out against owners, New York-based hedge fund Alden Global Capital. She was writing about Aldens growing newspaper empire, and wanted to know what it was like to be the last news reporter in town. When a reporter asked if their work was still valued, the editor sounded deflated. It was founded in 2007 by Randall D. Smith. We were in collective revolt, Lillian Reed, a Sun reporter who helped organize the campaign, told me. In conversations with former Alden employees, I heard repeatedly that their partnership seemed to transcend business. The 21st century has seen many of these generational owners flee the industry, to devastating effect. This is predatory.. The 5 global Trends in Journalism: 1 We've moved from a world where media organizations were gatekeepers to a world where media still creates the news agenda, but platform companies control access to audiences 2 this move to digital media generally does not generate filter bubbles Instead automated Serendipity + incidental exposure drive people . The new owners had announced a round of buyouts, some beloved staffers were leaving, and those who remained were worried about the future. Randy claims no editorial role in the Press, and his investment in the projectwhich has little chance of producing the kind of return hes accustomed tocould be chalked up to brotherly loyalty. In the for-profit news arena, Knight is spurring the digital transformation of local newsrooms through the Knight-Lenfest Newsroom Initiative, Sherry said. and our desire to support local newspapers over the long term." Alden said it wants to work Lee's board of . Alden completed its takeover of the Tribune papers in May. What Alden's potential acquisition of Lee Enterprises means for 20-plus

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