How Alden Global Capital Is Changing the Newspaper Industry

Alden Global Capital is a private equity firm that has been making waves in the newspaper industry. The company's aggressive business tactics have led to widespread criticism and concern about the future of local journalism.

Alden's business model is centered around cutting costs and increasing profits, often at the expense of quality journalism. This approach has resulted in significant job losses and reduced newsroom staff.

One notable example of Alden's impact is the Denver Post, where the company's ownership led to a 30% reduction in staff. This has had a ripple effect on the quality of reporting and the ability of the newspaper to cover local news.

Alden's focus on cost-cutting has also led to the elimination of print editions for several newspapers, including the San Jose Mercury News and the Orange County Register.

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Alden Global Capital has made several significant acquisitions in the publishing industry.

In May 2021, Alden finalized its purchase of Tribune Publishing for $635 million, or $17.25 per share. This acquisition added nine major metropolitan dailies to Alden's portfolio, including the Chicago Tribune and the New York Daily News.

The Baltimore Sun was sold to David D. Smith in January 2024, marking a change in ownership for the newspaper. The purchase price was not immediately disclosed.

Alden's first involvement with Tribune Publishing dates back to 2019, when they paid $117.9 million for a 25.2-percent stake in the company.

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Alden Global Capital has had its fair share of failed acquisition attempts. In 2019, they attempted a hostile takeover of Gannett, but it didn't work out.

Their next attempt was at Lee Enterprises, where they purchased a 5.9-percent stake in January 2020. They made an offer to purchase the company in its entirety for roughly $141 million in November 2021.

The Lee Enterprises board responded by enacting a shareholder rights plan, also known as a "poison pill", which forbids Alden from purchasing more than 10% of the company for one year. This move was taken to ensure shareholders receive fair treatment and protection in connection with Alden's proposal.

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Alden's attempt to acquire Gannett in 2019 was a notable failed acquisition attempt. They tried a hostile takeover, but it didn't work out.

The purchase price and details of the deal were not disclosed, but it's clear that Alden was serious about expanding its media empire.

It's worth noting that Alden has had success with other acquisitions, like its purchase of Tribune Publishing in 2021 for $635 million.

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Alden Global's acquisition attempt of Lee Enterprises was a notable failed bid. Alden purchased a 5.9-percent stake in Lee Enterprises in January 2020.

Lee Enterprises owns 77 daily newspapers, including the Buffalo News, Omaha World-Herald and the Tulsa World. The company's board of directors was not interested in selling.

In November 2021, Alden made an offer to purchase Lee Enterprises in its entirety for roughly $141 million. The board of Lee Enterprises responded by enacting a shareholder rights plan, also known as a "poison pill", to ward off the purchase attempt.

The shareholder rights plan forbids Alden from purchasing more than 10% of the company. This plan will be in force for one year.

The Lee board unanimously rejected the Alden bid, stating that the proposal "grossly undervalues Lee and fails to recognize the strength of our business today." Alden's offer was seen as too low.

Alden Global filed a lawsuit in state court in Delaware against Lee Enterprises. The lawsuit asserted that the Lee board members were more focused on maintaining their corporate positions than what's best for the company.

The Delaware court found in favor of Lee Enterprises in mid-February 2022. This setback led Alden to try a different tactic.

Alden filed 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. This attempt also failed.

Margaret Sullivan of The Washington Post and Joe Nocera of Bloomberg have both written scathing reviews of Alden's business practices. They describe Alden and its president, Heath Freeman, as "a destroyer of newspapers".

In 2020, Joe Pompeo pilloried Alden in Vanity Fair for reducing newsrooms. Alden has eliminated the jobs of scores of reporters and editors, and decimated journalism in cities all over the country.

The Atlantic examined the impact of Alden's acquisition of the Chicago Tribune in 2021. The new owners gutted the place, showing no interest in the vital civic role of journalism.

Alden has shut down eight weekly newspapers in Minnesota, leaving the communities without their long-time local papers.