It feels like were going up against capitalism now, Lillian Reed, the reporter who helped launch the Save Our Sun campaign, told me. But within weeks, Bainum said, Alden tried to tack on a five-year licensing deal that would have cost him tens of millions more. So Freeman pivoted. The new owners had announced a round of buyouts, some beloved staffers were leaving, and those who remained were worried about the future. [2] [3] By mid-2020, Alden had stakes in roughly two hundred American newspapers. 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. They had a father-figure relationship, one told me. The newspaper lost a quarter of its staff to buyouts after it was acquired by Alden Global Capital in May. 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. They are also defined by an obsessive secrecy. Freeman, his 41-year-old protg and the president of the firm, would be unrecognizable in most of the newsrooms he owns. But the group that jumps out to me on the list is the John S. and James L. Knight Foundation. Heath Freeman, president of Alden Global Capital, is known for pushing big cost reductions, which he says help to save newspapers. About a month after The Baltimore Sun was acquired by Alden, a senior editor at the paper took questions from anxious reporters on Zoom. Hellman and BNP together own 46.4 per cent of Allfunds' shares. 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.). Media . According to Aldens scarce SEC filings, it currently has fewer than 10 investors, most of them from overseas. But who most of those few souls are, and how much of the hundreds of millions skimmed from DFM papers theyve received remains a deep, dark mystery. But outside the industry, few seemed to notice. Alden, a New York City-based firm that has become the grim reaper of American newspapers, had recently increased its stake in Tribune Publishing to 32%making it the largest shareholder of the . The newspaper lost a quarter of its staff to buyouts after it was acquired by Alden Global Capital in May. 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. The $633 million sale made Alden the nation's second largest newspaper owner in terms of circulation, with more than 200 newspapers. 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 completed its takeover of the Tribune papers in May. In the past 15 years, more than a quarter of American newspapers have gone out of business. Alden Global Capital is a hedge fund based in Manhattan, New York City. But for Simon, that paper exists entirely in the past. Margaret Sullivan: The Constitution doesnt work without local news. By the charitys own accounting, it lost $ 2.3 million in book value on a $17 million investment that year. by Magnus Shaw..An enormous advertising company (Leo Burnett) and a small creative film company (Asylum) have had a difficult couple of weeks. 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. but sadly on a global scale there is hardly any independent news sources left currently. Others pointed to Bainums financing partner, who pulled out of the deal at the 11th hour. After weeks of back-and-forth, he agreed to a phone call, but only if parts of the conversation could be on background (which is to say, I could use the information generally but not attribute it to him). No response came back. But Glidden felt sure he knew the real reason: Alden wanted him gone. Or to Denver, where the Posts staff was cut by two-thirds, evicted from its newsroom, and relocated to a plant in an area with poor air quality, where some employees developed breathing problems. By Julie Reynolds. 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. The Tampa Bay Times has sold its printing plant at 1301 34th St. N to a real estate arm of Alden Global Capital, a New York hedge fund that is the second-largest newspaper owner in the country. Who Profits From Alden Global Capital? Some people believe that local newspapers will eventually be replaced by new publications, which Coppins describes as "built from the ground-up for the digital era." The newsroom was moved to a single room rented from the local chamber of commerce. Vallejo deserves better. A few weeks after the story came out, he was fired. He started as a general-assignment reporter, covering local crime and community events. But there are some clues here and there. I knew they almost never talked to reporters, but Randall Smith and Heath Freeman were now two of the most powerful figures in the news industry, and theyd gotten there by dismantling local journalism. [2] Its managing director is Heath Freeman. When the city-hall reporter left a few months later, he picked up that beat too. . I felt like a terrible reporter because I couldnt get to everything.. The best architects of the era were invited to submit designs; lofty quotes about the Fourth Estate were selected to adorn the lobby. At their worst, they used their papers to maintain oppressive social hierarchies. On the surface, the answer might seem obvious. The most promising prospect materialized in Baltimore, where a hotel magnate named Stewart Bainum Jr. expressed interest in the Sun. This was the core of Freemans argument. "[34], In October 2021, The Atlantic examined the impact of Alden's acquisition of the Chicago Tribune, noting that, "The new owners did not fly to Chicago to address the staff, nor did they bother with paeans to the vital civic role of journalism. Shares of Lee Enterprises Inc. rose sharply Monday after hedge fund Alden Global Capital LLC offered to buy the newspaper publisher for about $141 million. [8][24] Tribune Publishing publishes nine major metropolitan dailies. 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. The bid by Alden Global Capital, which already owns about 200 local newspapers, had faced resistance from Tribune staff and last-ditch competition. 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. He writes a weekly column called Mugger that savages the citys journalists by name and frequently runs to 10,000 words. 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. It's a tangled tale but essentially Asylum produced a film for the McDonald's charitable foundation for Leo. 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. Theres little evidence that Alden cares about the sustainability of its newspapers. MNG Enterprises, Inc., doing business as Digital First Media and MediaNews Group, is a Denver, Colorado -based newspaper publisher owned by Alden Global Capital. You need real capital to move the needle, he told me. Nov. 22, 2021. He studied art at Alfred University under sculptors Glenn Zweygardt and William Parry. [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. More to the point, Tribune Publishingwhich represents a substantial portion of Aldens titleswas profitable at the time of the acquisition. Like many alumni of the Sun, Simon is steeped in the papers history. That might sound like a losing formula, but these papers dont have to become sustainable businesses for Smith and Freeman to make money. Even in a declining industry, the newspapers still generated hundreds of millions of dollars in annual revenues; many of them were turning profits. Aldens Distressed Opportunities Fund was launched in 2008 and saw astounding success in its first few months, showing returns of more than 30 percent a big rescue for Alden, whose investments in Russia the year before had lost more than 61 percent of their value. Through it all, the owners maintained their ruthless silencespurning interview requests and declining to articulate their plans for the paper. 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. 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 summer, Alden Global Capital acquired Tribune Publishing and its titles, from small community newspapers to major metro titles like its flagship, The Chicago Tribune, and The Baltimore Sun. The Alden Global Capital . And two, by at least 2013, those of us who worked at Alden-controlled papers (like me) were already experiencing the slashing and burning. He scores big with a bankrupt aerospace manufacturer, and again with a Dallas-based drilling company. On . Layout design was outsourced to freelancers in the Philippines. Before our interview, Id contacted a number of Aldens reporters to find out what they would ask their boss if they ever had the chance. That may well be the future of local news, he says. Some in the city started to wonder if the paper was even worth saving. After college he worked at Hudson Studio, Art Foundry in Niverville, NY . He used his own money to pull court records, and went years without going on a vacation. 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. When a reporter asked if their work was still valued, the editor sounded deflated. 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 . Even as Aldens portfolio grew, Freeman rarely visited his newspapers. Some have even suggested that this represents Americas last chance to save its local-news industry. In the Hyatt meeting, Ted Venetoulis, a former Baltimore politician, advised the reporters to pick a noisy public fight: Set up a war room, circulate petitions, hold events to rally the city against Alden. But this acquisition was profound, making Alden Global . [7][8] Alden's purchase price was $635 million, or $17.25 per share. 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. . Bainum told me hed come to appreciate local journalism in the 1970s while serving in the Maryland state legislature. 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). When a local newspaper vanishes, research shows, it tends to correspond with lower voter turnout, increased polarization, and a general erosion of civic engagement. So what is this Distressed Opportunities fund? The story of Alden Capital begins on the set of a 1960s TV game show called Dream House. Earnest and unpolished, with a perpetually mussed mop of hair, Bainum presented himself as a contrast to the cutthroat capitalists at Alden. "Local newspaper brands and operations are the engines that power trusted local news in communities across the United States," Heath Freeman, president of Alden Global Capital, said in a . Freeman was clearly aware of his reputation for ruthlessness, but he seemed to regard Aldens commitment to cost-cutting as a badge of honorthe thing that distinguished him from the saps and cowards who made up Americas previous generation of newspaper owners. Reading these stories now has a certain horror-movie quality: You want to somehow warn the unwitting victims of whats about to happen. There were sober op-eds and lamentations on Twitter and expressions of disappointment by professors of journalism. In the for-profit news arena, Knight is spurring the digital transformation of local newsrooms through the Knight-Lenfest Newsroom Initiative, Sherry said. Theyre being targeted by investors who have figured out how to get rich by strip-mining local-news outfits. AP. Meanwhile, the Tribunes remaining staff, which had been spread thin even before Alden came along, struggled to perform the newspapers most basic functions. The movement gained traction in some markets, with local politicians and celebrities expressing solidarity. Most of his investments are defined by a cold pragmatism, but he takes a more personal interest in the media sector. Next year, Bainum will launch The Baltimore Banner, an all-digital, nonprofit news outlet. [11], In November 2021, Alden Global Capital made an offer to purchase Lee Enterprises for $24 a share in cash, or about $141 million. 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. It felt important. Iowa-based Lee Enterprises asks investors to help fight off hedge fund Alden Global Capital. , 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. Instead, the money was used to finance the hedge funds other ventures. City budgets balloon, along with corruption and dysfunction. It . 'Vulture' Fund Alden Global, Known For Slashing Newsrooms, Buys Tribune Papers, Stop The Presses! Last week, Alden Global Capital, the hedge fund notorious for slashing costs at its local titles, came down on the No side of the question, with editorial boards at papers that it owns stating that they will no longer endorse candidates for governor, US senator, or president. 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. Other records turned up from public pension funds and filings of publicly traded companies. 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.
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