Report: Hedge Firm Could Control Tribune Publishing In 2020

Alden Global Capital, the hedge fund headed by Heath Freeman that’s been dubbed a “strip miner” of newspapers, has a standstill agreement until June 30, 2020, that blocks it from increasing its 32-percent stake in Tribune, The NY Post is reporting.

June 30, 2020, is also the expiration date of a separate standstill clause governing the shares controlled by the second-largest Tribune shareholder: Dr. Patrick Soon-Shiong, who owns a stake of more than 24 percent.

That means the LA-based health-care billionaire is free to sell — and Alden is free to buy — Tribune stock starting on July 1, 2020.

If Freeman snaps up the shares controlled by Soon-Shiong, it would give Alden more than 56 percent of the common stock and propel it into a position as majority shareholder of the company that publishes the Chicago Tribune, the Baltimore Sun, the New York Daily News and other papers.

In an SEC filing last month, Alden said it could seek some representation — believed to be two seats — on the Tribune board.

Alden, which was thwarted in its pitch to take over Gannett earlier this year, shocked the media world last month when it revealed in an SEC filing that it had acquired the stock of former chairman Michael Ferro, who was at the time Tribune’s single largest shareholder with 24.6 percent of the shares. Alden subsequently revealed additional stock buys that upped its stake to 32 percent.

Newspapers that fell under Alden’s control at MNG and its Digital First Media have been rocked by deep cuts to newsrooms at papers including the Boston Herald, the Denver Post, and other papers, including the Orange County Register.

After purchasing his stake in May 2016, Soon-Shiong appeared as a white knight coming to the aid of one-time pal Ferro while he was fighting off a hostile takeover bid from Gannett. Soon-Shiong and Ferro ended up feuding, and Soon-Shiong ultimately bought the LA Times and San Diego Union-Tribune for $500 million.