Inside Alden Global Capital. [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. He quotes H. L. Mencken, the papers crusading 20th-century columnist, on the joys of journalism: It is really the life of kings. To be sure, the Knight Foundation does much to help promote and sustain local news. 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. I put the question to Freeman, but he declined to answer on the record. Already the largest shareholder . 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. 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. by Magnus Shaw..An enormous advertising company (Leo Burnett) and a small creative film company (Asylum) have had a difficult couple of weeks. Alden Global Capital already had a 32% stake in Tribune Publishing, which owns famous names like the Tribune, Daily News, the Hartford Courant and others, and on Tuesday announced it would pay . 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. Tribune Publishing last month approved a $630m takeover deal with Alden Global Capital. Researchers at the University of North Carolina found that Alden-owned newspapers have cut their staff at twice the rate of their competitors; not coincidentally, circulation has fallen faster too, according to Ken Doctor, a news-industry analyst who reviewed data from some of the papers. 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. Shareholders of Tribune Publishing, one of the country's largest newspaper chains, on Friday approved a takeover by hedge fund Alden Global Capital. About a month after The Baltimore Sun was acquired by Alden, a senior editor at the paper took questions from anxious reporters on Zoom. , From the February 1905 issue: The confessions of a newspaper woman, The papers union hired a PR firm to launch a public-awareness campaign under the banner Save Our Sun and published a letter calling on the Tribune board to sell the paper to local owners. "[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. . Tips that he would never have time to investigate piled up on a legal pad he kept at his desk. Below are highlights from his conversation with Morning Edition's A Martnez. To him, its the same as oil, the publisher said. This story originally appeared on the Morning Edition live blog. What happens next? But that would require slow, painstaking workand there are easier ways to make money. It . Caleb will later recall, in an interview with D Magazine, asking his dad why he works so hard. Nov. 22, 2021. The audio for this interview was produced by Ryan Benk and edited by Scott Saloway. Coppins offers several examples, like the Chicago Tribune and California's Vallejo Times-Herald. It felt important. [8][24] Tribune Publishing publishes nine major metropolitan dailies. Theres no industry that I can think of more integral to a working democracy than the local-news business, he said. 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. 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. But in the meantime, there isn't really anything that can fill the hole these newspapers will leave if they're shut down. Freeman was more animated when he turned to the prospect of extracting money from Big Tech. When it was over, a quarter of the newsroom was gone. [2] Its managing director is Heath Freeman. These papers would have been liquidated if not for us stepping up.. Layout design was outsourced to freelancers in the Philippines. When The New York Times profiles him in 1991, it notes that he excels at profiting from other peoples misery and quotes a parade of disgruntled clients and partners. In February 2021, he announced a handshake deal to buy the Sun from Alden for $65 million once it acquired Tribune Publishing. John Temple: My newspaper died 10 years ago. Morale tanked; reporters burned out. The most promising prospect materialized in Baltimore, where a hotel magnate named Stewart Bainum Jr. expressed interest in the Sun. Otherwise, youre just peeing in the ocean.. 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. Longtime Tribune staffers had seen their share of bad corporate overlords, but this felt more calculated, more sinister. He shut down Project Thunderdome, parted ways with Paton, and placed all of Aldens newspapers on the auction block. All good works, and Knight is to be commended for them. 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. ", "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? 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. According to its 990s, Knight ended up making $185,000 over five years on its initial $13.4 million investment. [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. Freeman was only slightly more accessible. 'Vulture' Fund Alden Global, Known For Slashing Newsrooms, Buys Tribune Papers, Stop The Presses! And two, by at least 2013, those of us who worked at Alden-controlled papers (like me) were already experiencing the slashing and burning. It was all about the next quarters profit margins, says Matt DeRienzo, who worked as a publisher for Aldens Connecticut newspapers before finally resigning. 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 . (Freeman denied this through a spokesperson.) 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. But as an organization that believes that quality information is essential for individuals and communities to make their own bestchoices, it was disappointing that the foundation couldnt simply own up to its error in judgment when it came to Alden. 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. The pay was terrible and the work was not glamorous, but Glidden loved his job. When I asked Freeman what he thought was broken about the newspaper industry, he launched into a monologue that was laden with jargon and light on insightsummarizing what has been the conventional wisdom for a decade as though it were Aldens discovery. AP. You could look to Oakland, California, where the East Bay Times laid off 20 people one week after the paper won a Pulitzer. But there was still a sliver of hope: Tribune and Alden agreed that the hedge fund would not increase its stake in the company for at least seven months. Alden Global Capital already owns 200 publications and a 6% stake in Lee Enterprises. Knight began selling off its Alden holdings in 2012, and got completely out in 2014. One acquaintance tells The Village Voice that hes the kind of guy who divests himself every couple of years to avoid ending up on lists of the worlds richest people. "[17] and Vanity Fair dubbed Alden the "grim reaper of American newspapers. [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. 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. When a reporter asked if their work was still valued, the editor sounded deflated. A Secretive Hedge Fund Is Gutting Newsrooms. Smith & Company, a firm founded by Randall Duncan Smith, initially using the $20,000 cash prize he and his wife won on the 1968-1970 gameshow Dream House. But outside the industry, few seemed to notice. It's traded in a prestigious downtown newsroom for a "Chipotle-sized office" near the printing press. One known investor, however, is the Randall and Barbara Smith Foundation, named for Alden founder Smith and his wife. It was founded in 2007 by Randall D. Smith. 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. Or to nearby Monterey, where the former Herald reporter Julie Reynolds says staffers were pushed to stop writing investigative features so they could produce multiple stories a day. The shows premise pits two couples against each other for the chance to win a home. So why be surprised that Knight-Ridder or anyone else is investing in destructive but profitable ventures? I asked Knight about those investments and whether the Foundations officers had any regrets, knowing what we now do about Aldens devastating effect on its own newspapers. 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. . It feels like were going up against capitalism now, Lillian Reed, the reporter who helped launch the Save Our Sun campaign, told me. Even in the greed is good climate of the era, Randy is a polarizing character on Wall Street. * Edited from 'independent . It financed the deal with the help of Cerberusa private-equity firm that owned, among other businesses, the security company that trained Saudi operatives who participated in the murder of the journalist Jamal Khashoggi. Maybe theyd cancel their subscriptions eventually; maybe the papers would fold altogether. [4], Alden purchased a 5.9-percent stake in Lee Enterprises in January 2020. On the appointed afternoon, I dialed the number provided by his spokesperson and found myself talking to the most feared man in American newspapers. Shares of Lee Enterprises Inc. rose sharply Monday after hedge fund Alden Global Capital LLC offered to buy the newspaper publisher for about $141 million. He teaches his 8-year-old son, Caleb, to make trades on a Quotron computer, and imparts the value of delayed gratification by reportedly postponing his familys Christmas so that he can use all their available cash to buy stocks at lower prices in December. Freemans father, Brian, was a successful investment banker who specialized in making deals on behalf of labor unions.
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