He said that he still appreciated their journalism, but that he couldnt speak for his corporate bosses. 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. Ken Kelleher - Creative Director / Artist - LinkedIn A group of 11 community newspapers owned by Red Wing Publishing Co. have been sold to MediaNews Group, owner of the St. Paul Pioneer Press and more than 100 newspapers across the country. Controversial hedge fund Alden Global wins bidding for Chicago Tribune Hedge fund Alden Global is buying newspaper chain Tribune Publishing 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. [8][24] Tribune Publishing publishes nine major metropolitan dailies. [32], The company has been criticized for investing money for pensions of newspaper employees in funds it manages itself. We dont hear from them Theyre, like, nameless, faceless people., In the months that followed, the Sun did not immediately experience the same deep staff cuts that other papers did. Coppins offers several examples, like the Chicago Tribune and California's Vallejo Times-Herald. He shut down Project Thunderdome, parted ways with Paton, and placed all of Aldens newspapers on the auction block. If you went into a lab to create the perfect bro, Heath would be that creation, says one former executive at an Alden-owned company, who, like others in this story, requested anonymity to speak candidly. Heath Freeman, president of Alden Global Capital, is known for pushing big cost reductions, which he says help to save newspapers. and our desire to support local newspapers over the long term." Alden said it wants to work Lee's board of . When it was over, a quarter of the newsroom was gone. When the sale failed to attract a sufficiently high offer, Freeman turned his attention to squeezing as much cash out of the newspapers as possible. How exactly Randall Smith chose Heath Freeman as his protg is a matter of speculation among those who have worked for the two of them. Some of these papers likely would have been liquidated if the fund had not stepped in to buy them, as Alden's president told Coppins. The paper had weathered a decade and a half of mismanagement and declining revenues and layoffs, and had finally achieved a kind of stability. Bainum told me hed come to appreciate local journalism in the 1970s while serving in the Maryland state legislature. One known investor, however, is the Randall and Barbara Smith Foundation, named for Alden founder Smith and his wife. John Temple: My newspaper died 10 years ago. Over the course of seven years, Alden doubled profits in its Bay Area News Group newspapers, another home to cutbacks. Others pointed to Bainums financing partner, who pulled out of the deal at the 11th hour. Nov. 22, 2021. He declined to meet me in person or to appear on Zoom. In its bid to acquire Tribune Publishing, the hedge fund Alden Global Capital vowed to provide $375 million in cash to the owner of the Chicago Tribune, the Baltimore Sun and other titles a . Alden Global Capital moves to buy Lee Enterprises, owner of the St Live news: US manufacturing sector contracts for fourth straight month In Orlando, the Sentinel ran an editorial pleading with the community to deliver us from Alden and comparing the hedge fund to a biblical plague of locusts. In Allentown, Pennsylvania, reporters held reader forums where they tried to instill a sense of urgency about the threat Alden posed to The Morning Call. Tuesday, 23 November 2021 07:46 PM EST. 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. When a local newspaper vanishes, research shows, it tends to correspond with lower voter turnout, increased polarization, and a general erosion of civic engagement. Pioneer Press owner buys 11 more Minnesota papers - Star Tribune Fears for future of American journalism as hedge funds flex power Reading these stories now has a certain horror-movie quality: You want to somehow warn the unwitting victims of whats about to happen. 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). Joe Pompeo pilloried Alden in Vanity Fair for reducing newsrooms. Alden Global Capital, the hedge fund that owns The Virginian-Pilot and Daily Press in Virginia, has proposed purchasing Lee Enterprises, the Iowa-based owner of the Richmond Times-Dispatch and most other major Virginia newspapers, for approximately $144 million, Alden announced Monday. Unless the Tribunes trajectory changes, Chicago may soon provide a grim case study. When Simon called me, he was on the set of his new miniseries, We Own This City, which tells the true story of Baltimore cops who spent years running their own drug ring from inside the police department. Some expressed exasperation with the staff of the Chicago Tribune, who were unable to find a single interested local buyer. When Alden first started buying newspapers, at the tail end of the Great Recession, the industry responded with cautious optimism. For two men who employ thousands of journalists, remarkably little is known about them. 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. Maybe this obscure hedge fund had a plan. The company has been growing its portfolio and as of May 2021, owns over 100 newspapers and 200 assorted other publications. ", "Denver Post Rebels Against Its Hedge-Fund Ownership", "Tribune Says Sale to Alden Wins Approval Amid Confusion Over Key Shareholder's Vote", "Lee Enterprises Shares Jump on Takeover Offer From Alden", "The vulture is hungry again: Alden Global Capital wants to buy a few hundred more newspapers", "Colorado Group Pushes to Buy Embattled Denver Post From New York Hedge Fund", "The battle for Tribune: Inside the campaign to find new owners for a legendary group of newspapers", "Is this strip-mining or journalism? He scores big with a bankrupt aerospace manufacturer, and again with a Dallas-based drilling company. The one central theme, the Times reports, seems to be that Smith and its web of affiliates are out, first and foremost, for themselves. If this reputation bothers Randy and his colleagues, they dont let on: For a while, according to The Village Voice, his firm proudly hangs a painting of a vulture in its lobby. These papers would have been liquidated if not for us stepping up.. 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. The term vulture capitalism hasnt been invented yet, but Randy will come to be known as a pioneer in the field. In budget meetings, according to the former executive, Freeman hectored local publishers, demanding that they produce detailed numbers off the top of their head and then humiliating them when they couldnt. [14], Alden has a reputation for sharply cutting costs by reducing the number of journalists working on its newspapers. It will rely initially on philanthropic donations, but he aims to sell enough subscriptions to make it self-sustaining within five years. Reporters kept reporting, and editors kept editing, and the union kept looking for ways to put pressure on Alden. . But outside the industry, few seemed to notice. And everyone knows its going to run dry.. Alden Global Capital seeks to buy Lee Enterprises for $144M [2] Its managing director is Heath Freeman. Freeman never responded. 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. 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. Prior to the buildings completion, McCormick directed his foreign correspondents to collect fragments of various historical sitesa brick from the Great Wall of China, an emblem from St. Peters Basilicaand send them back to be embedded in the towers facade. We must finally require the online tech behemoths, such as Google, Apple, and Facebook, to fairly compensate us for our original news content, he told me. Convinced that the Sun wont be able to provide the kind of coverage the city needs, he has set out to build a new publication of record from the ground up. They want to know who exactly profits when we learn, as Harvard Nieman Labs Ken Doctor recently reported, that the firm netted $160 million last year from its Digital First Media newspapers. Lee Enterprises rejects Alden Global Capital's unsolicited proposal Alden Global to buy Tribune Publishing for $630 million - Los Angeles Times A search through nonprofit groups publicly available financial reports, commonly known as Form 990s, reveals that all kinds of organizations some surprising have invested their monies with Alden over the years. Hedge fund Alden to buy Tribune Publishing in deal valued at $630 When John Glidden first joined the Vallejo Times-Herald, in 2014, it had a staff of about a dozen reporters, editors, and photographers. [30], Alden Global Capital includes a real estate division called Twenty Lake Holdings, which primarily buys excess real estate from newspapers. And that has consequences for democracy, as journalist McKay Coppins writes in The Atlantic. When the Chicago Tribune held a Save Local News rally, most of the people who showed up were members of the media. Hedge fund Alden's bid to buy Chicago Tribune, other papers approved by Freeman would show up at business meetings straight from the gym, clad in athleisure, the executive recalled, and would find excuses to invoke his college-football heroics, saying things like When I played football at Duke, I learned some lessons about leadership. (Freeman was a walk-on placekicker on a team that won no games the year he played.). Its World War II correspondent brought firsthand news of Nazi concentration camps to American readers; its editorial page had the power to make or break political careers in Maryland. ), Crucially, the profits generated by Aldens newspapers did not go toward rebuilding newsrooms. But in the case of local news, nothing comparable is ready to replace these papers when they die. Hedge fund Alden in hunt for another big newspaper chain - WKMG Alden Launches $142 Million Bid for Publisher Lee Enterprises The pay was terrible and the work was not glamorous, but Glidden loved his job. Hedge fund Alden Global Capital in hunt for Lee Enterprises newspaper Already the largest shareholder . Research shows that when local newspapers disappear or are dramatically gutted, communities tend to see lower voter turnout, increased polarization, a general erosion of civic engagement and an environment in which misinformation and conspiracy theories can spread more easily. The men who devised this model are Randall Smith and Heath Freeman, the co-founders of Alden Global Capital. That may well be the future of local news, he says. (Freeman has, in the past, disputed Bainums account of the negotiations.) To David Simon, the whimpering end of The Baltimore Sun feels both inevitable and infuriating. He used his own money to pull court records, and went years without going on a vacation. Newspapers Affect Us, Often In Ways We Don't Realize, 'Project Mayhem': Reporters Race To Save Tribune Papers From 'Vulture' Fund. But that's not true for all of them. Lee Enterprises, the owner of daily newspapers in Winston-Salem and Greensboro, this morning rejected a hedge fund's proposal to take over the company. Theres little evidence that Alden cares about the sustainability of its newspapers. By that point, Alden was widely known as the grim reaper of American newspapers, as Vanity Fair had put it, and news of the acquisition plans had unleashed a wave of panic across the industry. The Ubiquity - The student news site of Quartz Hill High School About a month after The Baltimore Sun was acquired by Alden, a senior editor at the paper took questions from anxious reporters on Zoom. PDF GateHouse Media Alden Global Capital Tribune Media McClatchy Lee Financially, it was a raw deal. Instead, they gutted the place. Of course, its easy to romanticize past eras of journalism. 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. 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. Theres no industry that I can think of more integral to a working democracy than the local-news business, he said. In the ensuing exodus, the paper lost the Metro columnist who had championed the occupants of a troubled public-housing complex, and the editor who maintained a homicide database that the police couldnt manipulate, and the photographer who had produced beautiful portraits of the states undocumented immigrants, and the investigative reporter whod helped expose the governors offshore shell companies. Feb 16, 2021 at 8:05 pm. In a news release Monday, Alden said it sent Lee's board a letter with the offer. Many of the operators were looking at the newspaper business as a local advertising business, he said, and we didnt believe that was the right way to look at it. As a privately held hedge fund, Alden doesnt have to reveal much to the public. Now it might be facing extinction. Several interim executive positions were also filled by people related to Alden or its parent, Smith Management LLC.[23]. Well, he told me, they have some very good reporters., This article appears in the November 2021 print edition with the headline The Men Who Are Killing Americas Newspapers., A Secretive Hedge Fund Is Gutting Newsrooms, I Dont Know That I Would Even Call It Meth Anymore, W. G. Sebald Ransacked Jewish Lives for His Fictions. 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. Smith & Company. Lee's board of directors . But that would require slow, painstaking workand there are easier ways to make money. 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. Year after year, the executives from Alden would order new budget cuts, and Glidden would end up with fewer co-workers and more work. The largest share of the blame was assigned to the Tribune board for allowing the sale to Alden to go through. "[26] Shortly thereafter, Alden Global, through its operating unit Strategic Investment Opportunities, filed a lawsuit in state court in Delaware against Lee Enterprises. "[18], Alden received critical coverage from the editorial staff at the Denver Post, who described Alden Global Capital as "vulture capitalists" after multiple staff layoffs. 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. Last week, Alden Global Capital, the hedge fund notorious for slashing costs at its local titles, came down on the No side of the question, with editorial boards at papers that it owns stating that they will no longer endorse candidates for governor, US senator, or president. The Tribune had been profitable when Alden took over. 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. He studied art at Alfred University under sculptors Glenn Zweygardt and William Parry. That's because the fund is stepping in to buy and then gut newsrooms across the country. But beneath all the recriminations and infighting was a cruel reality: When faced with the likely decimation of the countrys largest local newspapers, most Americans didnt seem to care very much. In February 2021, he announced a handshake deal to buy the Sun from Alden for $65 million once it acquired Tribune Publishing. but sadly on a global scale there is hardly any independent news sources left currently. He was fired after criticizing Alden in a Washington Post interview. It was founded in 2007 by Randall D. Smith. 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 . Read: What we lost when Gannett came to town. Tribune Publishing last month approved a $630m takeover deal with Alden Global Capital. MediaNews Group came out of bankruptcy in March 2010 under the majority ownership of its lenders. 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. 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. He says he visited the Tribune's office and was "really shocked by how grim the scene was." The men killing Americas newspapers, how Slack upended the workplace, and the new meth. Theyre being targeted by investors who have figured out how to get rich by strip-mining local-news outfits. Im worried the worst is yet to come. One tagline he was considering was Marylands Best Newsroom., When I asked, half in jest, if he planned to raid the Sun to staff up, he responded with a muted grin.