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Tribune commits to $630 million in hedge fund acquisitions



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Tribune commits to $630 million in hedge fund acquisitions


In a deal worth $630 million, newspaper publisher Tribune agreed to sell to Alden Global Capital, a hedge fund known for reducing expenses and removing newsroom jobs.

Owned by the Chicago Tribune, the New York Daily News, the Baltimore Sun and other newspapers, Tribune Publishing Co. said Tuesday it had agreed to sell its shares in cash to Alden for $17.25 each.

In 2019, Alden became the largest shareholder of Tribune Publishing; it owns a 32% stake. The hedge fund controls one of the largest newspaper chains in the country; the Boston Herald, the Denver Post and the San Jose Mercury News are among its papers.

In the contract, the Baltimore Sun is not included. The paper “for the benefit of the community,” the Sun wrote on Tuesday, will be sold to a charity founded by businessman and philanthropist Stewart Bainum Jr. that will run the paper.

According to the Chicago Tribune, the Tribune deal’s success depends on securing the votes of biotech billionaire and Los Angeles Times owner Patrick Soon-Shiong, who owns about 24% of Tribune Publishing, and shareholder Mason Slaine, a former media executive who owns about 8%. On Tuesday, Slaine and a spokesperson for Soon-Shiong did not respond immediately to requests for comment.

Tribune said the purchase price represents a 45 percent premium to the closing price of Tribune’s stock on Dec. 11, the last trading day before Alden’s proposal was received by the company. The deal, which is expected to close in the second quarter, has been approved by Tribune’s board.

Journalists from the Tribune have spoken about their concerns about Alden’s power and control over their journals. In the newspapers it acquires to squeeze out profits, Alden is notorious for cutting prices and shrinking newsrooms. The MediaNews Company, which owns the Boston Herald, the Denver Post and hundreds of other articles, is behind it.

For the company’s journals, the unions at Tribune papers pushed for alternative buyers.

As it deals with a digital transformation and declining sales, the newspaper industry has been consolidating. According to Pew Research, newsroom jobs declined by nearly half from 2004 to 2018. Those stresses were compounded by the pandemic. In November, Tribune’s chief financial officer said that during the pandemic, the company was “aggressively” lowering expenses, including furloughs, wage cuts and closing its newsrooms.

In a statement, Alden said: “We are well established in our commitment to ensuring the sustainability of robust local journalism and this is part of that effort.”

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