Shareholders of Tribune Publishing, one of the country’s largest newspaper chains, on Friday approved a takeover by hedge fund Alden Global Capital.
Alden, which already owned nearly one-third of Tribune, stands to take full control of the Chicago Tribune, Baltimore Sun and other Tribune papers in a deal worth roughly $630 million. Through its Media New Group subsidiary, Alden also owns the St. Paul Pioneer Press and TwinCities.com, the Boston Herald, Denver Post and San Jose Mercury News. With the Tribune acquisition, Alden would become the second-largest newspaper owner in the U.S. behind Gannett.
Patrick Soon-Shiong, the owner of the Los Angeles Times and Tribune’s No. 2 shareholder, abstained from the vote. Union officials cast doubt on the outcome because of that.
They cited Tribune’s proxy statement of April 20, which states that approval of the deal required the votes of at least two-thirds of shares not owned by Alden, and that an “abstain” vote counted the same as an “against” vote. Soon-Shiong, in a statement issued through a representative, said he “abstained from voting” and that he viewed Tribune as a “passive investment.”
“We’re digging into this question right now,” said Jon Schleuss, president of the NewsGuild journalists union.
Representatives for Alden, Tribune and the special committee of Tribune’s board did not immediately reply to questions about the vote count.
This is just the latest acquisition of a newspaper company by a financial firm. The collapse of print advertising as readers migrate to digital publications has rocked the traditional newspaper business. Publishers have shut down more than 2,000 papers over the past 15 years and half of newsroom jobs have disappeared. Investment firm owners are often criticized for valuing profits over the mission of local journalism, and Alden is no exception.
The deal had drawn opposition from many of the company’s journalists at papers. They set up rallies, tried to find local buyers and begged for a rescue in their own newspapers. They had rooted for a higher bid from hotel mogul Stewart Bainum in the belief that it would be better for local journalism, although the bid never came to fruition. They lobbied Soon-Shiong to vote no and stop the deal.
Alden became Tribune’s largest shareholder in 2019. The union representing Tribune’s journalists says the hedge fund’s cost cuts have already led to shrinking newsrooms and closed offices.
“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,” said Heath Freeman, president of Alden, in a statement.
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Author: Associated Press