During its five-year run with Alden, it seems quite unlikely that no one at Knight knew about the hedge funds slash-and-burn strategy for two reasons. [33], Alden Global Capital's management of American newspapers has been criticized. Hedge fund Alden Global Capital is attempting to acquire Davenport-based Lee Enterprises, one of the country's largest newspaper chains, in all the markings of a hostile takeover. Like many alumni of the Sun, Simon is steeped in the papers history. And two, by at least 2013, those of us who worked at Alden-controlled papers (like me) were already experiencing the slashing and burning. [11], In November 2021, Alden Global Capital made an offer to purchase Lee Enterprises for $24 a share in cash, or about $141 million. [3] [4] With its acquisition of Tribune Publishing in late . 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. The New York-based hedge fund Alden Global Capital - known for slashing its newspapers' budgets to extract escalated profits - won shareholder approval Friday for its $633 million bid to acquire the Tribune Publishing newspaper chain.. But in the case of local news, nothing comparable is ready to replace these papers when they die. NPR's A Martnez talks to McKay Coppins of The Atlantic about how a hedge fund, Alden Global Capital, is buying and then gutting newspapers and the implications for democracy. Aldens website contains no information beyond the firms name, and its list of investors is kept strictly confidential. G ARY MARX and David Jackson, two veteran investigative reporters at the Chicago Tribune, spent most of last year seeking potential buyers who might save their newspaper from Alden Global Capital . [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. 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. Freeman was more animated when he turned to the prospect of extracting money from Big Tech. but sadly on a global scale there is hardly any independent news sources left currently. Alden completed its takeover of the Tribune papers in May. [21], Under the acquisition plan, MediaNews Group debt fell to $165 million from about $930 million. Now it might be facing extinction. Of course, its easy to romanticize past eras of journalism. Tuesday, 23 November 2021 07:46 PM EST. A vulture doesnt hold a wounded animals head underwater. We were like, Theyre not going to take our newspaper from us! [15][16] In March 2018, Margaret Sullivan, the media columnist for The Washington Post, called Alden "one of the most ruthless of the corporate strip-miners seemingly intent on destroying local journalism. But a sense of fatalism permeated the work. Who Profits From Alden Global Capital? So Freeman pivoted. Other large shareholders include Californian asset manager Capital Group and UK fund manager Jupiter Asset Management. At the time, finalternatives.com reported that the Global Distress Opportunities fund would focus on financial firms as well as homebuilding, gaming and auto-related names.. But it turned out that Smith had so many doorsteps16 mansions in Palm Beach alone, as of a few years ago, some of them behind gatesthat the plan proved impractical. 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? The vulture is hungry again: Alden Global Capital wants to buy a few [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. The men who devised this model are Randall Smith and Heath Freeman, the co-founders of Alden Global Capital. The newspaper lost a quarter of its staff to buyouts after it was acquired by Alden Global Capital in May. In conversations with former Alden employees, I heard repeatedly that their partnership seemed to transcend business. A month after he started, one of his fellow reporters left and Glidden was asked to start covering schools in addition to his other responsibilities. They could be vain, bumbling, even corrupt. Bainum envisioned rebuilding the paperwhich, by 2020, was down to a single full-time statehouse reporteras a nonprofit. 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. Some publications, such as the Minneapolis Star Tribune, have developed successful long-term models that Aldens papers might try to follow. Tribune shareholders approve takeover by Alden Global Capital This investment strategy does not come without social consequences. Connecting this to the current state of American newspaper ownership seems rather tenuous.. Through it all, the owners maintained their ruthless silencespurning interview requests and declining to articulate their plans for the paper. By 2011, when Aldens Distressed Opportunities Fund lost more than 20 percent of its value, Knights holdings in the fund were valued at $10.7 million. The Tribune had been profitable when Alden took over. But even for a group of journalists, it was tough to keep the publics attention. But by 2013, despite deep losses to Alden funds overall values in the previous two years, Smith was able to begin buying his now infamous swath of South Florida mansions for $58 million and Freeman was acquiring multi-million-dollar New York condos. It is a subsidiary of Alden Global Capital, the New York City hedge fund that backed the purchase of and dramatic cost-cutting at more than 100 newspapers causing more than 1,000 lost jobs. Coppins describes Alden as a specific type of firm: a "vulture hedge fund." He wrote, "Alden Global Capital has eliminated the jobs of scores of reporters and editors, and decimated journalism in cities all over the country: Denver, Boston, San Jose, Trenton, etc. Lee Enterprises owns 77 daily newspapers, including the Buffalo News, Omaha World-Herald and the Tulsa World. According to Aldens scarce SEC filings, it currently has fewer than 10 investors, most of them from overseas. But who most of those few souls are, and how much of the hundreds of millions skimmed from DFM papers theyve received remains a deep, dark mystery. Inside Alden Global Capital. 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 . 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. The 21st century has seen many of these generational owners flee the industry, to devastating effect. As a young man, hed studied at divinity school before taking over his fathers company, and decades later he still carried a healthy sense of noblesse oblige. But as long as Alden had made back its money, the investment would be a success. I asked. Alden Global Capital is a hedge fund based in Manhattan, New York City. To industry observers, Aldens brazen model set it apart even from chains like Gannett, known for its aggressive cost-cutting. Stewart Bainum, since losing his bid for the Sun, has been quietly working on a new venture. For Baltimore to avoid a similar fate, Simon told me, something new would have to come alonga spiritual heir to the Sun: A newspaper is its contents and the people who make it. Alden gradually took control of the papers that would become DFM. It was all about the next quarters profit margins, says Matt DeRienzo, who worked as a publisher for Aldens Connecticut newspapers before finally resigning. The model is simple: Gut the staff, sell the real estate, jack up subscription prices, and wring as much cash as possible out of the enterprise until eventually enough readers cancel their subscriptions that the paper folds, or is reduced to a desiccated husk of its former self. ", "Hedge Fund Reaches a Deal to Buy Tribune Publishing", "Opinion - Will The Chicago Tribune Be the Next Newspaper Picked to the Bone? He quotes H. L. Mencken, the papers crusading 20th-century columnist, on the joys of journalism: It is really the life of kings. Alden Global Capital makes offer for Lee Enterprises, owner of Winston Theyre being targeted by investors who have figured out how to get rich by strip-mining local-news outfits. 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 . Live news updates from February 28: Tesla to build Mexico - ft.com To be sure, the Knight Foundation does much to help promote and sustain local news. Russ Smith is a puckish libertarian whose self-described contempt for the journalistic class animates the pages of the publication. The Tribune Tower, the iconic former home of the Chicago Tribune, seen in Chicago, Illinois in 2015. He told me it will begin with an annual operating budget of $15 million, unprecedented for an outfit of this kind. You need real capital to move the needle, he told me. 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 . For Smith, the Palm Beach conservative and Trump ally, sticking it to the mainstream media might actually be a perk of Aldens strategy. 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 . Hes acutely aware of the risksI may end up with egg on my face, he saidbut he believes its worth trying to develop a successful model that could be replicated in other markets. The Ubiquity - The student news site of Quartz Hill High School 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.. Probably not.. The show draws from a book written by a Sun reporter, and Simon was quick to point out that the paper still has good journalists covering important stories. At the Suns peak, it employed more than 400 journalists, with reporters in London and Tokyo and Jerusalem. In my many conversations with people who have worked with Freeman, not one could recall seeing him read a newspaper. After a powerful Illinois state legislator resigned amid bribery allegations, the paper didnt have a reporter in Springfield to follow the resulting scandal. Alden, which already owned one-third of . 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. They are also defined by an obsessive secrecy. I asked, What is the Foundations perspective on those investments now, as news of Aldens gutting of these newspapers has come to light?. For a fleeting moment, Aldens newspapers became unexpected darlings of the journalism industrywritten about by Poynter and Nieman Lab, endorsed by academics like Jay Rosen and Jeff Jarvis. It was clear that they didnt care about this being a business in the future. But that would require slow, painstaking workand there are easier ways to make money. * Edited from 'independent . Module 5- Journalism.pdf - Journalism Modules - The 5 Ws Hedge fund Alden's bid for owner of Virginian-Pilot, Daily Press Theres little evidence that Alden cares about the sustainability of its newspapers. I would know he didnt mean it, and he would know he didnt mean it, but he would at least go through the motions. 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. Nov. 22, 2021. (PDF) Extractive Imperialism in the Americas | henry veltmeyer

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