Inside Alden Global Capital. When Alden first started buying newspapers, at the tail end of the Great Recession, the industry responded with cautious optimism. The 21st century has seen many of these generational owners flee the industry, to devastating effect. You could look to Oakland, California, where the East Bay Times laid off 20 people one week after the paper won a Pulitzer. Joe Pompeo pilloried Alden in Vanity Fair for reducing newsrooms. MNG Enterprises, Inc., doing business as Digital First Media and MediaNews Group, is a Denver, Colorado -based newspaper publisher owned by Alden Global Capital. Some in the city started to wonder if the paper was even worth saving. 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%. Nov. 22, 2021. 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. 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. A reporter at one of his newspapers suggested I try doorstepping Smithshowing up at his home unannounced to ask questions from the porch. 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. My answer is its hard to know. But whats happening in Chicago is different. 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. Enter the email address you signed up with and we'll email you a reset link. Frustrated and worn out, Glidden broke down one day last spring when a reporter from The Washington Post called. 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. Lee's board of directors . 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. This investment strategy does not come without social consequences. What threatens local newspapers now is not just digital disruption or abstract market forces. With full control of Tribune Publishing, Alden Global Capital is scrambling to squeeze out a return on its $600 million investment in the struggling Chicago-based newspaper company. Well, that wasnt the point. Clearly, for Smith and Freeman, chop-shopping their newspapers paid off. Hedge fund Alden Global Capital, known for making deep newsroom cuts, won approval to acquire Tribune Publishing, which includes the Chicago Tribune, The Baltimore Sun and New York Daily News. You need real capital to move the needle, he told me. He took particular pride in finding novel ways to give away his family fortune, funding child-poverty initiatives in Baltimore and prenatal care for women in Liberia. Alden, which has built a reputation as one of the newspaper industry's most aggressive cost-cutters, became Tribune Publishing's largest shareholder in November 2019 and owns a 31.3% stake. It will rely initially on philanthropic donations, but he aims to sell enough subscriptions to make it self-sustaining within five years. [2] Its managing director is Heath Freeman. Most responded with variations on the same question: Which recent stories from your newspapers have you especially appreciated? But Glidden felt sure he knew the real reason: Alden wanted him gone. But for Simon, that paper exists entirely in the past. 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. [32], The company has been criticized for investing money for pensions of newspaper employees in funds it manages itself. This was the core of Freemans argument. Feeling burned by the hedge fund, Bainum decided to make a last-minute bid for all of Tribune Publishings newspapers, pledging to line up responsible buyers in each market. The newspaper lost a quarter of its staff to buyouts after it was acquired by Alden Global Capital in May. Shortly after the Tribune deal closed earlier this year, I began trying to interview the men behind Alden Capital. Next up: Chicago, Baltimore, and the New York Daily News. It has figured out how to make a profit by driving newspapers into the ground, he says, since Alden's aim is not to make them into long-term sustainable businesses but rather maximize profits quickly to show it has made a winning investment. This is predatory.. 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. What exactly went wrong would become a point of bitter debate among the journalists involved in the campaigns. When Alden first got into the news business, Freeman seemed willing to indulge some innovation. But for all the theatrics, his marching orders were always the same: Cut more. MediaNews Group came out of bankruptcy in March 2010 under the majority ownership of its lenders. Its hard to imagine theyd show, anyway. In early 2011, Alden was still considered a non-controlling investor, but by the end of the year, that would change. We were like, Theyre not going to take our newspaper from us! Freemans father, Brian, was a successful investment banker who specialized in making deals on behalf of labor unions. Somehow, no one's buying it. 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. On Monday, Dail At one point, I tracked down the photographer whod taken the only existing picture of Smith on the internet. They are also defined by an obsessive secrecy. [2] [3] By mid-2020, Alden had stakes in roughly two hundred American newspapers. I asked, What is the Foundations perspective on those investments now, as news of Aldens gutting of these newspapers has come to light?. To him, its the same as oil, the publisher said. Read: Local news is dying, and Americans have no idea, From 2015 to 2017, he presided over staff reductions of 36 percent across Aldens newspapers, according to an analysis by the NewsGuild (a union that also represents employees of The Atlantic). Heath Freeman, president of Alden Global Capital, is known for pushing big cost reductions, which he says help to save newspapers. 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. 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. Freeman, his 41-year-old protg and the president of the firm, would be unrecognizable in most of the newsrooms he owns. My request for an interview with Smith was dismissed by his spokesperson before I finished asking. 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 Tribune Tower, the iconic former home of the Chicago Tribune, seen in Chicago, Illinois in 2015. (Freeman denied this characterization through a spokesperson. Its being snuffed out, quarter after quarter after quarter. We were sitting in a coffee shop in Logan Square, and he was still struggling to make sense of what had happened. "The question is, will local communities decide that this is an important issue, that it's worth saving these newspapers, protecting them from firms like Alden, or will they decide that they don't really care?" Collectively, they control about one-half of daily newspapers in the U.S. By McKay 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. It . That may well be the future of local news, he says. NPR reached out to Alden for a response. Newspapers Affect Us, Often In Ways We Don't Realize, 'Project Mayhem': Reporters Race To Save Tribune Papers From 'Vulture' Fund. 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. I asked if anyone there at the time was aware of Aldens vulture business strategy. But a sense of fatalism permeated the work. 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. [22] The appointees to the MediaNews board were replaced by new directors representing the stockholders group led by Alden Global Capital. 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. Freeman was only slightly more accessible. Russ Smith is a puckish libertarian whose self-described contempt for the journalistic class animates the pages of the publication. We were in collective revolt, Lillian Reed, a Sun reporter who helped organize the campaign, told me. 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. On . 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. Today, we know that Knight, CalPERS and others no longer invest with Alden. 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. Alden, which has built a reputation as one of the newspaper industry's most aggressive cost-cutters, became Tribune Publishing's largest shareholder in November 2019 and owns a 31.3% stake. [7][8] Alden's purchase price was $635 million, or $17.25 per share. 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. Yes, today, it's a newspaper without a newsroom. * Edited from 'independent . Some expressed exasperation with the staff of the Chicago Tribune, who were unable to find a single interested local buyer. Maybe theyd cancel their subscriptions eventually; maybe the papers would fold altogether. So far, Alden has limited its closures primarily to weekly newspapers, but Doctor argues its only a matter of time before the firm starts shutting down its dailies as well. Instead, they gutted the place. The shows premise pits two couples against each other for the chance to win a home. When a local newspaper vanishes, research shows, it tends to correspond with lower voter turnout, increased polarization, and a general erosion of civic engagement. In May, The Alden Global Capital a hedge fund, acquired Tribune Publishing TPCO for $633 million. That's because the fund is stepping in to buy and then gut newsrooms across the country. The families that used to own the bulk of Americas local newspapersthe Bonfilses of Denver, the Chandlers of Los Angeleswere never perfect stewards. 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 . Lee Enterprises owns 77 daily newspapers, including the Buffalo News, Omaha World-Herald and the Tulsa World. Knight began selling off its Alden holdings in 2012, and got completely out in 2014. The pay was terrible and the work was not glamorous, but Glidden loved his job. Orders for non-defence capital goods excluding aircraft a closely watched proxy for business investment, rose 0.8 per cent in January from a month earlier, comfortably above economists . Gerry Smith. And everyone knows its going to run dry.. [21], Under the acquisition plan, MediaNews Group debt fell to $165 million from about $930 million. The firm oversaw the promotion of John Paton, a charismatic digital-media evangelist, who improved the papers web and mobile offerings and increased online ad revenue. Glidden, then a mild-mannered 30-year-old, had come to journalism later in life than most and was eager to prove himself. (Freeman denied this through a spokesperson.) Alden gradually took control of the papers that would become DFM. Around this time, Randy becomes preoccupied with privacy. 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 men killing Americas newspapers, how Slack upended the workplace, and the new meth. 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. In May 2021, Tribune Publishing finalized its sale to Alden, after having announced in February 2021 that it intended to pursue this path.
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