Tribune Publishing shareholders on Friday approved “vulture” fund Alden Global Capital’s $633 million bid to buy the Chicago-based newspaper chain—a development that sparked both confusion about how key ballots were recorded as well as outrage among journalists, union leaders, and readers alarmed over what the future may hold.
The New York-based hedge fund, which critics have called “the face of bloodless strip-mining of American newspapers and their communities,” plans to take the company private and will become the second-largest newspaper owner in the United States, after Gannett, if the deal closes, which is expected by the end of June. Alden was already the largest shareholder, holding about a third of the company’s stock.
“This is terrible news for the Chicago Tribune and all our sister newspapers. It’s also terrible news for the communities these papers cover and, I’d argue, for the country,” humor columnist Rex Huppke said in a series of tweets. “I’m going to take a moment to feel angry, disappointed, and a bit scared. Then I’m going to do exactly what my colleagues here in Chicago, and my colleagues in Baltimore and New York and Hartford and Orlando and in newsrooms across the country, will do: get back to work.”
3/ I can't be bothered with people who view newspapers as businesses to be squeezed for profit, or as disposable investments. None of us got into this to make money. We got into it because we have the unshakable ailment of giving a damn about the word around us and wanting to…— Rex Huppke (@RexHuppke) May 21, 2021
5/ …covering beats like hawks. Some do it by making readers laugh, or think, or cry. It's the sum of all those parts that makes a newspaper great, and the desire to do such things can't be dictated by hedge funds or feckless billionaires who lack the courage to take a stand.— Rex Huppke (@RexHuppke) May 21, 2021
Tribune Publishing’s other outlets include The Baltimore Sun; the Hartford Courant; the Orlando Sentinel; the South Florida Sun Sentinel; the New York Daily News; the Capital Gazette in Annapolis, Maryland; The Morning Call in Allentown, Pennsylvania; the Daily Press in Newport News, Virginia; and The Virginian-Pilot in Norfolk, Virginia.
In a joint statement Friday, unions representing newsroom staff across the newspaper chain blasted the shareholder vote and vowed to keep fighting for media workers.
“Today, Tribune Publishing shareholders voted to put profit and greed over local news in our country,” the statement said. “While we are saddened by the turn of events, we know that our work over the past year—to build allies in the community and to raise awareness about Alden—is not in vain. Those allies will support us as we fight against Alden to protect local news and the cuts that they will inevitably try to make.”
Last weekend, hundreds of NewsGuild members rallied in Annapolis, Chicago, Hartford, Orlando, and Virginia Beach against Alden’s attempt to purchase Tribune Publishing.
“A takeover by Alden Global Capital is a threat to the work that our journalists do for our community,” Ella Wood of UNITE HERE Local 737 warned at the Orlando rally. “Without your work, our stories do not get told.”
Jim Friedlich, the chief executive of the Lenfest Institute for Journalism, a nonprofit that owns The Philadelphia Inquirer, tweeted that Friday was “a very bad day for local news,” expressing concern about what the hedge fund will do the newspapers.
“Alden’s playbook is pretty straightforward: Buy low, cut deeper,” Friedlich explained to the New York Times. “There’s little reason to believe that Alden will approach full ownership of Tribune any differently than they have their other news properties.”
With Alden Capital's acquisition today of Tribune Co, our nation today reached an ominous milestone: half of the daily newspaper circulation is owned by hedge funds. We can't rebuild local news if we don't confront this tragic fact. @newsguild https://t.co/8tTSrBjT0K— Steven Waldman (@stevenwaldman) May 21, 2021
NPR‘s David Folkenflik reported Friday that “Alden’s founder, Randall Smith, sits on Tribune’s board, as do two other directors with close ties to Alden. Smith’s protégé, Heath Freeman, oversees Alden’s previous newspaper holdings and is the fund’s president. Both men keep low public profiles.”
In a statement after the shareholder meeting, Freeman confirmed the outcome of the vote and said that “the purchase of Tribune reaffirms our commitment to the newspaper industry and our focus on getting publications to a place where they can operate sustainably over the long term.”
Approval of the sale required the votes of at least two-thirds of shares not owned by Alden. Dr. Patrick Soon-Shiong owns about a 24% stake in Tribune Publishing, making him the company’s second-largest shareholder. His spokesperson said Friday that he abstained from voting, which caused widespread confusion.
Although an official abstention would have counted as an “no” vote, killing the proposed sale, the Chicago Tribune reported that company officials confirmed the proxy ballots registered to Soon-Shiong were submitted without the “abstain” box checked, so they were counted as “yes” votes.
Gregory Pratt, a city hall reporter and president of Chicago Tribune Guild, tweeted early Friday afternoon that “this is what we call a fluid situation—and a total nightmare,” while Jon Schleuss, president of the NewsGuild, told the Associated Press, “We’re digging into this question right now.”
Schleuss later said that Tribune Publishing pointed to the Chicago Tribune‘s report “as providing the best clarification.”
In a series of updates on Twitter, NPR‘s Folkenflik said that sources told him Soon-Shiong—who also owns the Los Angeles Times and The San Diego Union-Tribune—chose not to vote on the Alden-Tribune deal and “the sale was the result he intended.”
To be clear: I’m told that Soon-Shiong decided to allow Alden bid for Tribune to succeed, despite all of today’s confusion— David Folkenflik (@davidfolkenflik) May 21, 2021
The sale was the result he intended https://t.co/RQPgJsYLp5
Soon-Shiong’s spokesperson said in a statement Friday that “for the past several years, Tribune Publishing has been a passive investment, as he has remained focused on the leadership roles he holds across his companies.”
Earlier this week, Pratt wrote in an open letter to Soon-Shiong that “the newspapers in Tribune Publishing need your help.” Advocating for a ‘no’ vote, the union leader warned that “Alden ownership would be a disaster for Chicago, democracy, and society at large.”
“He should have taken a stand as a civic leader in journalism,” Pratt told the New York Times on Friday. “He had a responsibility, in my opinion, to vote ‘no,’ but at the bare minimum he had a responsibility to take a firm stance one way or the other instead of punt.”
Schleuss was also critical, saying in a lengthy statement that “voting in favor of selling to Alden represents a short-sighted view of the value of the company, and an utter disregard for the value of quality news coverage.”
“I am disturbed and upset. Yet, I cannot help but be optimistic,” Schleuss added. “We will continue to fight back. Our fight is a righteous one. We are fighting for our democracy.”
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