Alden’s Stake Brings Uncertainty To Tribune Publishing

When Michael Ferro sold his 25.2% ownership stake in Tribune Publishing to New York hedge fund Alden Global Capital last Tuesday, it ushered in new uncertainty for the publisher of the Chicago Tribune and other major daily newspapers.

Alden, a secretive hedge fund with a reputation for dramatic cost-cutting within its media empire, is now Tribune Publishing’s largest shareholder. It is in negotiations to add two seats to Tribune Publishing’s six-member board.

In addition to the Chicago Tribune, Tribune Publishing owns the Baltimore Sun; Hartford Courant; Orlando Sentinel; South Florida’s 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.

Senate Minority Leader Chuck Schumer, D-N.Y., who has been a vocal critic of Alden’s strategy of acquiring newspapers and cutting staff, issued a statement Wednesday saying he would be watching the hedge fund “like a hawk” in the wake of the Tribune investment.

“Any plans to reduce the size, scope or impact of the New York Daily News, as Alden has done in the past to other prominent newspapers, will be met with fierce resistance,” Schumer said in the statement.

Launched in 2007, Alden owns about 200 publications through an operating company now known as MediaNews Group, formerly Digital First Media. Holdings include major dailies such as the Denver Post, San Jose Mercury News and the St. Paul Pioneer Press, and smaller weeklies, with many of the newspapers based in California.

The chain has come under fire for sweeping layoffs at its newspapers. The flash point was the March 2018 news that the Denver Post, which Alden has controlled since 2010, was going to lay off 30 employees in a newsroom that had already shrunk from 250 to less than 100 staffers.

The newspaper published an editorial critical of Alden and the editorial page editor subsequently resigned. The layoffs took place as planned.

While Alden has been downsizing newsrooms, it has continued to aggressively pursue acquisitions.

Earlier this year, Alden made an unsuccessful hostile takeover bid to acquire Gannett, publisher of USA Today and more than 100 other newspapers. On Tuesday, Gannett completed a $1.2 billion merger with GateHouse Media, forming the largest newspaper chain in the U.S.