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. 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. 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. AP. In May, The Alden Global Capital a hedge fund, acquired Tribune Publishing TPCO for $633 million. Layout design was outsourced to freelancers in the Philippines. Tribune Publishing, publisher of the Chicago Tribune and other major newspapers, has agreed to be acquired by Alden Global Capital in a deal valued at $630 million . 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 . 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. Yes, today, it's a newspaper without a newsroom. While some finance reporters noted that Smiths newspaper investments were all losing value, none seemed to notice that Smith and Aldens president Heath Freeman would soon start strip mining their news companies real estate and other assets. The newsroom was moved to a single room rented from the local chamber of commerce. Have you heard of the hedge fund Alden Global Capital? How do you know who wins? the boy asks. hide caption. But in the case of local news, nothing comparable is ready to replace these papers when they die. Inside Alden Global Capital. Connecting this to the current state of American newspaper ownership seems rather tenuous.. The papers printing was moved to a plant more than 100 miles outside town, Glidden told me, which meant that the news arriving on subscribers doorsteps each morning was often more than 24 hours old. On March 9, 2020, a small group of Baltimore Sun reporters convened a secret meeting at the downtown Hyatt Regency. In the for-profit news arena, Knight is spurring the digital transformation of local newsrooms through the Knight-Lenfest Newsroom Initiative, Sherry said. It will rely initially on philanthropic donations, but he aims to sell enough subscriptions to make it self-sustaining within five years. I sort of bully people around to get stuff done, he boasted to The Washington Post in 1985. Instead, they gutted the place. The movement gained traction in some markets, with local politicians and celebrities expressing solidarity. When a reporter asked if their work was still valued, the editor sounded deflated. It . 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. Most responded with variations on the same question: Which recent stories from your newspapers have you especially appreciated? When the city-hall reporter left a few months later, he picked up that beat too. At their worst, they used their papers to maintain oppressive social hierarchies. 'Vulture' Fund Alden Global, Known For Slashing Newsrooms, Buys Tribune Papers, Stop The Presses! Knight spokesman Andrew Sherry declined to answer any of those questions, saying instead, Our endowment investments support our grantmaking., We invested approximately one half of one percent of our endowment in an Alden fund between late 2009 and early 2014, he said via email. To many, it just didnt seem possible that Alden would instead choose to destroy newspapers by laying off the workforce en masse and stripping papers of all their assets. Otherwise, youre just peeing in the ocean.. For Freeman and his investors to come out ahead, they didnt need to worry about the long-term health of the assetsthey just needed to maximize profits as quickly as possible. 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. 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. [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. Lee Enterprises owns 77 daily newspapers, including the Buffalo News, Omaha World-Herald and the Tulsa World. Coordinated by . Send any friend a story As a subscriber, you . In truth, Freeman didnt seem particularly interested in defending Aldens reputation. 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 . Clearly, for Smith and Freeman, chop-shopping their newspapers paid off. 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. Some expressed exasperation with the staff of the Chicago Tribune, who were unable to find a single interested local buyer. But that's not true for all of them. When the Chicago Tribune held a Save Local News rally, most of the people who showed up were members of the media. [2][3] By mid-2020, Alden had stakes in roughly two hundred American newspapers. Instead, they gutted the place. As the months passed, things kept getting worse. ), Crucially, the profits generated by Aldens newspapers did not go toward rebuilding newsrooms. 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. 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. [2] [3] By mid-2020, Alden had stakes in roughly two hundred American newspapers. 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, his 41-year-old protg and the president of the firm, would be unrecognizable in most of the newsrooms he owns. 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. Many in the journalism industry, watching lawsuits play out in Australia and Europe, have held out hope in recent years that Google and Facebook will be compelled to share their advertising revenue with the local outlets whose content populates their platforms. Lee's board of directors . He says he visited the Tribune's office and was "really shocked by how grim the scene was." 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. | Michael Gray, WIkimedia Commons. What happens next? So Freeman pivoted. (Freeman has, in the past, disputed Bainums account of the negotiations.) . Theres no industry that I can think of more integral to a working democracy than the local-news business, he said. I would know he didnt mean it, and he would know he didnt mean it, but he would at least go through the motions. 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 . 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. If they did it right, Venetoulis said, they just might be able to line up a local, civic-minded owner for the paper. Alden Global Capital is a hedge fund based in Manhattan, New York City. By McKay Coppins. This is predatory.. When he did, he exhibited a casual contempt for the journalists who worked there. And that has consequences for democracy, as journalist McKay Coppins writes in The Atlantic. 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. 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. In conversations with former Alden employees, I heard repeatedly that their partnership seemed to transcend business. Alden Global Capital is a hedge fund based in Manhattan, New York City. Reporters kept reporting, and editors kept editing, and the union kept looking for ways to put pressure on Alden. 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.). These papers were in many cases left for dead by local families not willing to make the tough but appropriate decisions to get these news organizations to sustainability. But Glidden felt sure he knew the real reason: Alden wanted him gone. We were in collective revolt, Lillian Reed, a Sun reporter who helped organize the campaign, told me. But a sense of fatalism permeated the work. To replace a paper like the Sun would require a large, talented staff that covers not just government, but sports and schools and restaurants and art. A reporter at one of his newspapers suggested I try doorstepping Smithshowing up at his home unannounced to ask questions from the porch. Meanwhile, with few newsroom jobs left to eliminate, Alden continued to find creative ways to cut costs. But maybe the clearest illustration is in Vallejo, California, a city of about 120,000 people 30 miles north of San Francisco. 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. One early article, in the trade publication Poynter, suggested that Aldens interest in the local-news business could be seen as flattering and quoted the owner of The Denver Post as saying he had enormous respect for the firm. "A lot of cities almost operate with the assumption that there will be at least one local newspaper, in some cases several local newspapers, acting as a check on the authorities," he says. Another ex-publisher told me Freeman believed that local newspapers should be treated like any other commodity in an extractive business. Alden, which already owned one-third of . Senior lenders under the deal were to swap debt for stock. Prior to the acquisition of the Tribune Company, we purchased substantially all of our newspapers out of bankruptcy or close to liquidation, he told me. Alden gradually took control of the papers that would become DFM. If you want to know what its like when Alden Capital buys your local newspaper, you could look to Montgomery County, Pennsylvania, where coverage of local elections in more than a dozen communities falls to a single reporter working out of his attic and emailing questionnaires to candidates. Some in the city started to wonder if the paper was even worth saving. They call Alden a vulture hedge fund, and I think thats honestly a misnomer, Johnson said. What most concerns him is how his city will manage without a robust paper keeping tabs on the people in charge. Its a hedge that went and bought up some titles that it milks for cash.. Tribune Publishing last month approved a $630m takeover deal with Alden Global Capital. [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. 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. The Tribune had been profitable when Alden took over. Stewart Bainum, since losing his bid for the Sun, has been quietly working on a new venture. This investment strategy does not come without social consequences. But there are some clues here and there. 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. They had a father-figure relationship, one told me. He declined to meet me in person or to appear on Zoom. Tuesday, 23 November 2021 07:46 PM EST. He used his own money to pull court records, and went years without going on a vacation. Shortly after the Tribune deal closed earlier this year, I began trying to interview the men behind Alden Capital. But for all the theatrics, his marching orders were always the same: Cut more. 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. Morale tanked; reporters burned out. By Julie Reynolds. but sadly on a global scale there is hardly any independent news sources left currently. 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. It felt important. Meanwhile, the Tribunes remaining staff, which had been spread thin even before Alden came along, struggled to perform the newspapers most basic functions. . 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. Rapid-fire changes underway at newspapers sold to cost-slashing hedge fund Alden Global Capital have led to a profound case of the jitters at newsrooms like the New York Daily News. Alden is in the business of making money, not journalism. Over the course of seven years, Alden doubled profits in its Bay Area News Group newspapers, another home to cutbacks. 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. My answer is its hard to know. 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. Today, half of all daily newspapers in the U.S. are controlled by financial firms, according to an analysis by the Financial Times, and the number is almost certain to grow. In February 2021, he announced a handshake deal to buy the Sun from Alden for $65 million once it acquired Tribune Publishing. 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. A look at Alden Global Capital is the cover story of the latest . Some have even suggested that this represents Americas last chance to save its local-news industry. 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.

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