In 2011, Paton launched an ambitious initiative he called Project Thunderdome, hiring more than 50 journalists in New York and strategically deploying them to supplement short-staffed local newsrooms. Traditional newspaper business model says you make 95% of your money off ad sales and the rest off subscriptions. Some have even suggested that this represents Americas last chance to save its local-news industry. But he couldnt help feeling that the police scandal would have been exposed much sooner if the Sun were operating at full force. When it was over, a quarter of the newsroom was gone. The $633 million sale made Alden the nation's second largest newspaper owner in terms of circulation, with more than 200 newspapers. 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. . It played with my mind a little bit, Glidden told me. In my many conversations with people who have worked with Freeman, not one could recall seeing him read a newspaper. And when Chicago suffered a brutal summer crime wave, the paper had no one on the night shift to listen to the police scanner. 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. City budgets balloon, along with corruption and dysfunction. What exactly went wrong would become a point of bitter debate among the journalists involved in the campaigns. After Brian took his own life, in 2001, Smith became a mentor and confidant to Heath, who was in college at the time of his fathers death. 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 . On the appointed afternoon, I dialed the number provided by his spokesperson and found myself talking to the most feared man in American newspapers. [30], Alden Global Capital includes a real estate division called Twenty Lake Holdings, which primarily buys excess real estate from newspapers. But within weeks, Bainum said, Alden tried to tack on a five-year licensing deal that would have cost him tens of millions more. By the 1980s, this strategy has made Randy luxuriously wealthyvacations in the French Riviera, a family compound outside New York Cityand he has begun to school his children on the wonders of capitalism. Alden is known for . [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. Around this time, Randy becomes preoccupied with privacy. Chicago-based Tribune Publishing on Tuesday announced a proposed sale to hedge fund Alden Global Capital in a deal valued at $630 million. These papers would have been liquidated if not for us stepping up.. 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. The hollowing-out of the Chicago Tribune was noted in the national press, of course. Today, we know that Knight, CalPERS and others no longer invest with Alden. To David Simon, the whimpering end of The Baltimore Sun feels both inevitable and infuriating. A century later, the Tribune Tower has retained its grandeur. You could look to Oakland, California, where the East Bay Times laid off 20 people one week after the paper won a Pulitzer. These include the Chicago Tribune, the New York Daily News, and The Baltimore Sun. If they did it right, Venetoulis said, they just might be able to line up a local, civic-minded owner for the paper. October 14, 2021. He declined to meet me in person or to appear on Zoom. 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. It was clear that they didnt care about this being a business in the future. , 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. Some in the city started to wonder if the paper was even worth saving. The California Public Employees Retirement System, a few European banks, and Citigroup and Coca Cola Companys pension funds have all invested in Alden, along with charities such as the Circle of Service Foundation and the Alfred University Endowment. 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. By the charitys own accounting, it lost $ 2.3 million in book value on a $17 million investment that year. In the past 15 years, more than a quarter of American newspapers have gone out of business. For those who cared about the future of local news, it was hard to imagine a better outcomewhich made it all the more devastating when the bid fell through. Have you heard of the hedge fund Alden Global Capital? 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. Alden Global Capital already owns 200 publications and a 6% stake in Lee Enterprises. Several interim executive positions were also filled by people related to Alden or its parent, Smith Management LLC.[23]. 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. Other records turned up from public pension funds and filings of publicly traded companies. 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. [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 firm has a history of purchasing newspapers to cut costs wherever . At the end of last month, Alden Global Capital, a notorious newspaper-owning hedge fund, sought to stake its claim on one of the last newspaper chains it hasn't yet touched: Lee Enterprises, which owns 90 publications across the country.Alden, which currently owns six percent of Lee's stock, sent an unsolicited offer to purchase the newspaper chain for $24 per share. 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. 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. "[25], In early December, the board of Lee unanimously rejected the Alden bid, saying that the Alden proposal "grossly undervalues Lee and fails to recognize the strength of our business today. Alden-owned newspapers have cut their staff at twice the rate of their competitors, for all of Tribune Publishings newspapers, security company that trained Saudi operatives. Alden Global Capital revealed a proposal Monday to purchase Lee Enterprise Inc. and its newspapers at $24 a share, casting alarm through the many newsrooms owned by Lee. On Monday, Dail This is predatory.. [4] [5] The company added more newspapers to its portfolio in May 2021 when it purchased Tribune . Alden Capital's gutting of the Denver Post is the most discussed example of this, but there are many others. The Tribune Tower, the iconic former home of the Chicago Tribune, seen in Chicago, Illinois in 2015. With aggressive cost-cutting, Alden can operate its newspapers at a profit for years while turning out a steadily worse product, indifferent to the subscribers its alienating. 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. Here was one of Americas most storied newspapersa publication that had endorsed Abraham Lincoln and scooped the Treaty of Versailles, that had toppled political bosses and tangled with crooked mayors and collected dozens of Pulitzer Prizesreduced to a newsroom the size of a Chipotle. 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 . With its acquisition of Tribune Publishing earlier this year, Alden now controls more than 200 newspapers, including some of the countrys most famous and influential: the Chicago Tribune, The Baltimore Sun, the New York Daily News. 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. [2] Its managing director is Heath Freeman. Alden Global Capital had recently purchased a nearly one-third stake in the Suns parent company, Tribune Publishing, and the firm was signaling that it would soon come for the rest. 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. 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. Send any friend a story As a subscriber, you . Smith, a reclusive Palm Beach septuagenarian, hasnt granted a press interview since the 1980s. One conclusions even these reporters are hesitant to make is that we are all dealing within a capitalist system which has none, or few, principles to guide itself, apart from making a profit, no matter how. Tips that he would never have time to investigate piled up on a legal pad he kept at his desk. How do you know who wins? the boy asks. The families that used to own the bulk of Americas local newspapersthe Bonfilses of Denver, the Chandlers of Los Angeleswere never perfect stewards. The purchase represents the culmination of Alden's years-long drive to take over the company and its storied titles . New York hedge fund and U.S. newspaper consolidator Alden Global Capital LLC has made a proposal to take Lee Enterprises Inc. private in a deal that values the company at around $141 million. 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. 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. As a privately held hedge fund, Alden doesnt have to reveal much to the public. Who is investor Randall Smith and why is he buying up newspaper companies, deep losses to Alden funds overall values, Denver Post newsroom workers invoke Thirst Amendment to raise awareness about conditions under Alden, Pittsburgh newspaper workers are making history, The NewsGuild urges public pension funds to divest from Cerberus, NewsGuild to Lee Shareholders: Reject Aldens Vote No Campaign. Hellman and BNP together own 46.4 per cent of Allfunds' shares. Reporters kept reporting, and editors kept editing, and the union kept looking for ways to put pressure on Alden. After a powerful Illinois state legislator resigned amid bribery allegations, the paper didnt have a reporter in Springfield to follow the resulting scandal. My answer is its hard to know. The Tribune Tower rises above the streets of downtown Chicago in a majestic snarl of . The Tribune Tower rises above the streets of downtown Chicago in a majestic snarl of Gothic spires and flying buttresses that were designed to exude power and prestige. Another ex-publisher told me Freeman believed that local newspapers should be treated like any other commodity in an extractive business.
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