The audio for this interview was produced by Ryan Benk and edited by Scott Saloway. Two days after the deal was finalized, Alden announced an aggressive round of buyouts. '60 Minutes' correspondent Jon Wertheim on local newspapers - Poynter 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. But maybe the clearest illustration is in Vallejo, California, a city of about 120,000 people 30 miles north of San Francisco. But for all the theatrics, his marching orders were always the same: Cut more. Shortly after the Tribune deal closed earlier this year, I began trying to interview the men behind Alden Capital. 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. But while its true that Alden entered the industry by purchasing floundering newspapers, not all of them were necessarily doomed to liquidation. 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 . . When a reporter asked if their work was still valued, the editor sounded deflated. The practical effect of the death of local journalism is that you get what weve had, he told me, which is a halcyon time for corruption and mismanagement and basically misrule.. 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. It was founded in 2007 by Randall D. 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. 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. Others pointed to Bainums financing partner, who pulled out of the deal at the 11th hour. He told me it will begin with an annual operating budget of $15 million, unprecedented for an outfit of this kind. Former Knight-Ridder headquarters. Tribune shareholders approve takeover by Alden Global Capital This is the story weve been telling for decades about the dying local-news industry, and its not without truth. MNG Enterprises, Inc., doing business as Digital First Media and MediaNews Group, is a Denver, Colorado -based newspaper publisher owned by Alden Global Capital. [2][3] By mid-2020, Alden had stakes in roughly two hundred American newspapers. "[18], Alden received critical coverage from the editorial staff at the Denver Post, who described Alden Global Capital as "vulture capitalists" after multiple staff layoffs. These included several Cayman Island-based funds and another profiting from Greek debt stemming from that countrys financial crisis. Tuesday, 23 November 2021 07:46 PM EST. He says he visited the Tribune's office and was "really shocked by how grim the scene was." Reading these stories now has a certain horror-movie quality: You want to somehow warn the unwitting victims of whats about to happen. Layout design was outsourced to freelancers in the Philippines. In conversations with former Alden employees, I heard repeatedly that their partnership seemed to transcend business. The firm has a history of purchasing newspapers to cut costs wherever . After a powerful Illinois state legislator resigned amid bribery allegations, the paper didnt have a reporter in Springfield to follow the resulting scandal. Iowa's Lee Enterprises seeks help to fight Alden's takeover bid Denver Post reporters vs 'vulture capitalist' hedge fund Alden - CNBC Baltimore is an underdog town, Liz Bowie, a Sun reporter who was at the meeting, told me. 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. 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. 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. 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 . 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 . 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. By the time the FBI caught them, in 2017, the conspiracy had resulted in one dead civilian and a rash of wrongful arrests and convictions. Alden currently owns 32%. But he couldnt help feeling that the police scandal would have been exposed much sooner if the Sun were operating at full force. 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. 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. [4], Alden purchased a 5.9-percent stake in Lee Enterprises in January 2020. When plans for the building were announced in 1922, Colonel Robert R. McCormick, the longtime owner of the Chicago Tribune, said he wanted to erect the worlds most beautiful office building for his beloved newspaper. Like many alumni of the Sun, Simon is steeped in the papers history. (Freeman has, in the past, disputed Bainums account of the negotiations.) (Freeman denied this characterization through a spokesperson. I would know he didnt mean it, and he would know he didnt mean it, but he would at least go through the motions. If you want to know what its like when Alden Capital buys your local newspaper, you could look to Montgomery County, Pennsylvania, where coverage of local elections in more than a dozen communities falls to a single reporter working out of his attic and emailing questionnaires to candidates. 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. We were in collective revolt, Lillian Reed, a Sun reporter who helped organize the campaign, told me. This is predatory.. Meanwhile, in Vallejo, John Glidden went from covering crime and community news to holding the title of the only hard news reporter in town, filling a legal pad with tips he knew he'd never have time to pursue. When he did, he exhibited a casual contempt for the journalists who worked there. But a sense of fatalism permeated the work. [2] Its managing director is Heath Freeman. The details of how Smith got to know him are opaque, but the resulting loyalty was evident. 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. Is this company saving newspapers or profiting from their demise? - The Much of the Knight family's once-grand newspaper empire was ultimately acquired by Alden Global Capital, while the family foundation invested in Alden funds. They had a father-figure relationship, one told me. Maybe this obscure hedge fund had a plan. . When a local newspaper vanishes, research shows, it tends to correspond with lower voter turnout, increased polarization, and a general erosion of civic engagement. Hedge fund Alden's bid to buy Chicago Tribune, other papers approved by "And what we've seen in a lot of these places where newspapers have been scaled back or even closed is there really is no comparable product in place, whether it's by the government or by another news organization, to do what these local newspapers have done for hundreds of years.". The pay was terrible and the work was not glamorous, but Glidden loved his job. Alden Global Capital is a hedge fund based in Manhattan, New York City. A young man named Randall Duncan SmithRandy for shortstands next to his wife, Kathryn, answering quick-fire trivia questions in front of a live studio audience. It has filed a lawsuit in its bid to buy out news publisher Lee Enterprises. My question was did Knight know what Alden was doing to newspapers when it invested with the hedge fund, and does it regret that investment now? By Julie Reynolds. "60 Minutes" correspondent Jon Wertheim did a strong piece that aired Sunday night about the grim state of local newspapers, in part because of how hedge funds, such as Alden Global Capital . Baltimore has always had its problems, he told me. A Secretive Hedge Fund Is Gutting Newsrooms. "A lot of cities almost operate with the assumption that there will be at least one local newspaper, in some cases several local newspapers, acting as a check on the authorities," he says. By McKay Coppins. . 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. Soon, Tribune-owned newsrooms across the country were kicking off similar campaigns. Alden Global Capital, the Hedge Fund Killing Newspapers - The Atlantic Lee Enterprises owns 77 daily newspapers, including the Buffalo News, Omaha World-Herald and the Tulsa World. The hollowing-out of the Chicago Tribune was noted in the national press, of course. Alden gradually took control of the papers that would become DFM. [14], Alden has a reputation for sharply cutting costs by reducing the number of journalists working on its newspapers. Am I going to win against capitalism in America? 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. If Knights total divestment from Alden in 2014 was because someone made an ethical decision to stop dealing with the vulture fund, good for them. When the city-hall reporter left a few months later, he picked up that beat too. 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. On the surface, the answer might seem obvious. For Freeman, newspapers are financial assets and nothing morenumbers to be rearranged on spreadsheets until they produce the maximum returns for investors. The Denver Post has become the face of this struggle, due to an editorial published in its own pages lashing out against owners, New York-based hedge fund Alden Global Capital. But he has a big idea: He believes theres serious money to be made in buying troubled companies, steering them into bankruptcy, and then selling them off in parts. With his own money, he helps his brother launch the New York Press, a free alt-weekly in Manhattan. 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. Inside Alden Global Capital. [13], Newspapers in Alden's portfolio include Chicago Tribune, The Denver Post, the St. Paul Pioneer Press, the Boston Herald, The Mercury News, East Bay Times, The Orange County Register, and Orlando Sentinel. But as long as Alden had made back its money, the investment would be a success. Have you heard of the hedge fund Alden Global Capital? "[28], In mid-February 2022, the Delaware court found in favor of Lee Enterprises. Im worried the worst is yet to come. Hedge fund Alden Global Capital in hunt for Lee Enterprises newspaper But there are some clues here and there. I felt like a terrible reporter because I couldnt get to everything.. The paper had weathered a decade and a half of mismanagement and declining revenues and layoffs, and had finally achieved a kind of stability. Margaret Sullivan: The Constitution doesnt work without local news. Longtime Tribune staffers had seen their share of bad corporate overlords, but this felt more calculated, more sinister. "[26] Shortly thereafter, Alden Global, through its operating unit Strategic Investment Opportunities, filed a lawsuit in state court in Delaware against Lee Enterprises. 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. NY Daily News owner Alden sues Lee after publisher rejects takeover bid
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