Tribune agrees to purchase by hedge fund for $630 million
Chicago – The newspaper publisher Tribune has agreed to be sold to Alden Global Capital, a hedge fund known for cutting costs and eliminating newsroom jobs, in a deal valued at $630 million.
Tribune Publishing Co., which owns the Chicago Tribune, the New York Daily News, the Baltimore Sun and other newspapers, said Tuesday it has agreed to sell its shares to Alden for $17.25 apiece, in cash.
Alden became Tribune Publishing’s largest shareholder in 2019; it holds a 32% stake. Alden owns MediaNews Group, one of the country’s largest newspaper chains, and is known for consolidation and cuts in fixed costs, including newsroom jobs, to squeeze out profits. Its papers include the Boston Herald, the Denver Post and the San Jose Mercury News.
MediaNews Group also owns The Detroit News, although the business operations of The News, along with those of the Detroit Free Press, are run by a partnership between the owners of the two newspapers. Under terms of that deal, the news staffs are separate and independent, but advertising, circulation, production and marketing efforts are combined.
The Baltimore Sun is not included in the Alden-Tribune deal. It will be sold to a nonprofit formed by businessman and philanthropist Stewart Bainum Jr. that will run the paper “for the benefit of the community,” the Sun wrote on Tuesday.
The success of the Tribune deal hinges 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%, according to the Chicago Tribune.
Tribune said the purchase price represents a premium of 45% to the closing price of Tribune’s shares on Dec. 11, the last trading day before the company received Alden’s proposal. Tribune’s board has approved the deal, which is expected to close in the second quarter.