It played with my mind a little bit, Glidden told me. The model is simple: Gut the staff, sell the real estate, jack up subscription prices, and wring as much cash as possible out of the enterprise until eventually enough readers cancel their subscriptions that the paper folds, or is reduced to a desiccated husk of its former self. They want to know who exactly profits when we learn, as Harvard Nieman Lab's Ken Doctor recently reported, that the firm netted $160 million last year from its Digital First Media . At the time, the Sun had a bustling bureau in Annapolis, and he marveled at the reporters ability to sort the honest politicians from the political whores by exposing abuses of power. 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. [30], Alden Global Capital includes a real estate division called Twenty Lake Holdings, which primarily buys excess real estate from newspapers. Senior lenders under the deal were to swap debt for stock. But if you really started fucking up in grandiose and belligerent ways, if you started stealing and grifting and lying, eventually somebody would come up behind you and say, Youre grifting and youre lying and theyd put it in the paper., The bad stuff runs for so long now, he went on, that by the time you get to it, institutions are irreparable, or damn near close., Take away the newsroom packed with meddling reporters, and a city loses a crucial layer of accountability. At one point, I tracked down the photographer whod taken the only existing picture of Smith on the internet. Layout design was outsourced to freelancers in the Philippines. Most of his investments are defined by a cold pragmatism, but he takes a more personal interest in the media sector. Meet the Hedge Fund Boss Who Just Bought Tribune's 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. 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 company has been growing its portfolio and as of May 2021, owns over 100 newspapers and 200 assorted other publications. 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. Aldens calculus was simple. He stops talking to the press, refuses to be photographed, and rarely appears in public. Alden Global Capital, the hedge fund that owns The Virginian-Pilot and Daily Press in Virginia, has proposed purchasing Lee Enterprises, the Iowa-based owner of the Richmond Times-Dispatch and most other major Virginia newspapers, for approximately $144 million, Alden announced Monday. They could be vain, bumbling, even corrupt. From the March 1914 issue: H. L. Mencken on newspaper morals, A story circulated throughout the companypossibly apocryphal, though no one could say for surethat when Freeman was informed that The Denver Post had won a Pulitzer in 2013, his first response was: Does that come with any money?. He said that he still appreciated their journalism, but that he couldnt speak for his corporate bosses. We must finally require the online tech behemoths, such as Google, Apple, and Facebook, to fairly compensate us for our original news content, he told me. So Freeman pivoted. Baltimore has always had its problems, he told me. 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 . But most of them also had a stake in the communities their papers served, which meant that, if nothing else, their egos were wrapped up in putting out a respectable product. Convinced that the Sun wont be able to provide the kind of coverage the city needs, he has set out to build a new publication of record from the ground up. Stewart Bainum, since losing his bid for the Sun, has been quietly working on a new venture. Theres no industry that I can think of more integral to a working democracy than the local-news business, he said. It . A native of Vallejo, he was proud to work for his hometown paper. A recent Financial Times analysis found that half of all daily newspapers in the U.S. are controlled by financial firms, and Coppins says that number is all but certain to keep growing. Alden completed its takeover of the Tribune papers in May. 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. We dont hear from them Theyre, like, nameless, faceless people., In the months that followed, the Sun did not immediately experience the same deep staff cuts that other papers did. Alden's holdings already spanned the country, including the . 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. Am I going to win against capitalism in America? City budgets balloon, along with corruption and dysfunction. 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 . In February 2021, he announced a handshake deal to buy the Sun from Alden for $65 million once it acquired Tribune Publishing. In a news release Monday, Alden said it sent Lee's board a letter with the offer. It feels like were going up against capitalism now, Lillian Reed, the reporter who helped launch the Save Our Sun campaign, told me. You have no way of knowing that if you dont have some nosy son of a bitch asking a lot of questions down there, he told me. One researcher tells me that if that money were invested in the S&P 500 Index Fund, it would have earned roughly $11 million over the same period. Its the meanness and the elegance of the capitalist marketplace brought to newspapers, Doctor told me. It has filed a lawsuit in its bid to buy out news publisher Lee Enterprises. According to its 990s, Knight ended up making $185,000 over five years on its initial $13.4 million investment. He quotes H. L. Mencken, the papers crusading 20th-century columnist, on the joys of journalism: It is really the life of kings. 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. 'Sobs, gasps, expletives' over latest Denver Post layoffs", "The Hedge Fund Vampire That Bleeds Newspapers Dry Now Has the Chicago Tribune by the Throat", "How Massive Cuts Have Remade The Denver Post", "Newsonomics: By selling to Americas worst newspaper owners, Michael Ferro ushers the vultures into Tribune", "A Secretive Hedge Fund Is Gutting Newsrooms", "Affiliated Media Files for Bankruptcy to Restructure (Update2)", "The shakeup at MediaNews: Why it could be the leadup to a massive newspaper consolidation", "Alden Global Capital to buy Tribune in deal valued at $630 million", "Lee Enterprises Enacts Poison Pill to Guard Against Alden Takeover", "Lee Enterprises Board Rejects Alden's Acquisition Offer", "Alden Global Capital takes Lee Enterprises to court over failed board nominations", "Alden Global Capital sues Lee Enterprises after rejected takeover bid", "Alden Global Capital loses lawsuit to nominate its slate of candidates for Lee Enterprises' board", "Lee Enterprises shareholders reelect three directors amid hedge fund fight", "Tampa Bay Times sells printing plant to developer for $21 million", "A hedge fund's 'mercenary' strategy: Buy newspapers, slash jobs, sell the buildings", "The hedge fund trying to buy Gannett faces federal probe after investing newspaper workers' pensions in its own funds", https://en.wikipedia.org/w/index.php?title=Alden_Global_Capital&oldid=1130942589, This page was last edited on 1 January 2023, at 19:27. Alden Global Capital, the New York hedge fund that bought Tribune Publishing this year, said on Monday that it was making an offer for another big American newspaper chain, Lee . When Simon called me, he was on the set of his new miniseries, We Own This City, which tells the true story of Baltimore cops who spent years running their own drug ring from inside the police department. The men killing Americas newspapers, how Slack upended the workplace, and the new meth. 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. Feb. 16, 2021 8:04 PM PT. Billionaires battle for Tribune Publishing | The Economist The hollowing-out of the Chicago Tribune was noted in the national press, of course. Im worried the worst is yet to come. Alden Global Capital is a hedge fund based in Manhattan, New York City. It's a tangled tale but essentially Asylum produced a film for the McDonald's charitable foundation for Leo. By 2011, when Aldens Distressed Opportunities Fund lost more than 20 percent of its value, Knights holdings in the fund were valued at $10.7 million. After a powerful Illinois state legislator resigned amid bribery allegations, the paper didnt have a reporter in Springfield to follow the resulting scandal. Research shows that when local newspapers disappear or are dramatically gutted, communities tend to see lower voter turnout, increased polarization, a general erosion of civic engagement and an environment in which misinformation and conspiracy theories can spread more easily. 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.). Tribune Sale to Alden Approved by Shareholders - The New York Times Newspapers Affect Us, Often In Ways We Don't Realize, 'Project Mayhem': Reporters Race To Save Tribune Papers From 'Vulture' Fund. There were sober op-eds and lamentations on Twitter and expressions of disappointment by professors of journalism. 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. Coppins offers several examples, like the Chicago Tribune and California's Vallejo Times-Herald. Lee's board of directors . [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 . It hurts to see the paper like this, he told her. On the appointed afternoon, I dialed the number provided by his spokesperson and found myself talking to the most feared man in American newspapers. When the Chicago Tribune held a Save Local News rally, most of the people who showed up were members of the media. More to the point, Tribune Publishingwhich represents a substantial portion of Aldens titleswas profitable at the time of the acquisition. I asked if anyone there at the time was aware of Aldens vulture business strategy. The firm has a history of purchasing newspapers to cut costs wherever . 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. Knight began selling off its Alden holdings in 2012, and got completely out in 2014. My answer is its hard to know. But outside the industry, few seemed to notice. Freemans father, Brian, was a successful investment banker who specialized in making deals on behalf of labor unions. What's in the fine print in Alden's offer to takeover Tribune? - The The New York-based hedge fund Alden Global Capital - known for slashing its newspapers' budgets to extract escalated profits - won shareholder approval Friday for its $633 million bid to acquire the Tribune Publishing newspaper chain.. Alden Global Capital has currently bid to buy all of Tribune. 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. Other records turned up from public pension funds and filings of publicly traded companies. When John Glidden first joined the Vallejo Times-Herald, in 2014, it had a staff of about a dozen reporters, editors, and photographers. Even in the greed is good climate of the era, Randy is a polarizing character on Wall Street. Soon, Tribune-owned newsrooms across the country were kicking off similar campaigns. [31], In 2019, Twenty Lake Holdings reported that it had acquired about 180 properties with 2.3 million square feet of real estate in 29 states. 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. The editor in chief mysteriously resigned, and managers scrambled to deal with the cuts. Clearly, for Smith and Freeman, chop-shopping their newspapers paid off. 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. 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. 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. Alden, which owns more than 200 newspapers across the country, has developed a reputation for using extensive layoffs and severe cost cuts at the newspapers it owns. Well, he told me, they have some very good reporters., This article appears in the November 2021 print edition with the headline The Men Who Are Killing Americas Newspapers., A Secretive Hedge Fund Is Gutting Newsrooms, I Dont Know That I Would Even Call It Meth Anymore, W. G. Sebald Ransacked Jewish Lives for His Fictions. 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. 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. Shortly after the Tribune deal closed earlier this year, I began trying to interview the men behind Alden Capital. 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. But in the case of local news, nothing comparable is ready to replace these papers when they die. And everyone knows its going to run dry.. But when I emailed his studio looking for information, I was informed curtly that the photo was no longer available. Had Smith bought the rights himself? Neither man will ever be the guest of honor at the annual dinner for the Committee to Protect Journalistsand thats probably fine by them. he asks. It seemed reasonable to ask that they answer a few questions. 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. In its bid to acquire Tribune Publishing, the hedge fund Alden Global Capital vowed to provide $375 million in cash to the owner of the Chicago Tribune, the Baltimore Sun and other titles a . But maybe the clearest illustration is in Vallejo, California, a city of about 120,000 people 30 miles north of San Francisco. It was all about the next quarters profit margins, says Matt DeRienzo, who worked as a publisher for Aldens Connecticut newspapers before finally resigning. Coppins describes Alden as a specific type of firm: a "vulture hedge fund." Misinformation proliferates. 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. [11], In November 2021, Alden Global Capital made an offer to purchase Lee Enterprises for $24 a share in cash, or about $141 million. Theres little evidence that Alden cares about the sustainability of its newspapers. [2][3] By mid-2020, Alden had stakes in roughly two hundred American newspapers. (PDF) Extractive Imperialism in the Americas | henry veltmeyer 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. 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. 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. 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. The question was how. Alden Global Capital owns 56 dailies under Digital First Media (Alden also owns 32% of Tribune 10 dailies in Column C.) Tribune Media owns 10 dailies. (Freeman has, in the past, disputed Bainums account of the negotiations.) But for that to happen, the Big Tech money would need to flow to underfunded newsrooms, not into the pockets of Aldens investors. If they did it right, Venetoulis said, they just might be able to line up a local, civic-minded owner for the paper. Bainum told me hed come to appreciate local journalism in the 1970s while serving in the Maryland state legislature. Alden Global Capital - Wikipedia Knight first reported its investment in Alden in 2010, noting the fair market value of its Alden holdings was $13.4 million. Heath Freeman in an undated photo provided by Goldin Solutions . Hedge fund Alden Global Capital in hunt for big newspaper chain Lee Of course, its easy to romanticize past eras of journalism. But years later, when Randy relocates to Palm Beach and becomes a major donor to Donald Trumps presidential campaign, it will make a certain amount of sense that his earliest known media investment was conceived as a giant middle finger to the journalistic establishment. With his own money, he helps his brother launch the New York Press, a free alt-weekly in Manhattan. By Julie Reynolds. Alden Global Capital is buying and gutting local newspapers : NPR - NPR.org 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 in hunt for another big newspaper chain He declined to meet me in person or to appear on Zoom. Alden Global Capital moves to buy Lee Enterprises, owner of the St 'Vulture' Fund Alden Global, Known For Slashing Newsrooms, Buys Tribune Papers, Stop The Presses! These were not exactly boom times for newspapers, after allat least someone wanted to buy them. . Alden Global Capital, the Hedge Fund Killing Newspapers - The Atlantic One tagline he was considering was Marylands Best Newsroom., When I asked, half in jest, if he planned to raid the Sun to staff up, he responded with a muted grin. Probably not.. 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. But a sense of fatalism permeated the work. Those that have survived are smaller, weaker, and more vulnerable to acquisition. Reading these stories now has a certain horror-movie quality: You want to somehow warn the unwitting victims of whats about to happen. Several years later, when Heath was still in his mid-20s, Smith co-founded Alden Global Capital with him, and eventually put him in charge of the firm. They call Alden a vulture hedge fund, and I think thats honestly a misnomer, Johnson said. They had a father-figure relationship, one told me. The Ubiquity - The student news site of Quartz Hill High School 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. You can bypass most soft paywalls with a little CSS knowledge Located in the same Manhattan office building as Alden, it funds stem-cell research, health-related charities, arts and culture and Duke University, alma mater of Smiths protg Heath Freeman. As a reporter whos covered Alden Global Capital for more than two years, people often ask me who are the investors behind the hedge fund that owns one of Americas largest newspaper chains? The most promising prospect materialized in Baltimore, where a hotel magnate named Stewart Bainum Jr. expressed interest in the Sun. The pitch had a certain romantic appeal to the reporters in the room. But that's not true for all of 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 .

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