The Media Today

Lee Enterprises holds off an Alden takeover—for now

December 10, 2021

At the end of last month, Alden Global Capital, a notorious newspaper-owning hedge fund, sought to stake its claim on one of the last newspaper chains it hasn’t yet touched: Lee Enterprises, which owns 90 publications across the country. Alden, which currently owns six percent of Lee’s stock, sent an unsolicited offer to purchase the newspaper chain for $24 per share. Later, it nominated three of its own candidates to Lee’s eight-person board of directors. 

It was par for the course for Alden; in recent years, the hedge fund has taken over Tribune Publishing and MediaNews Group in a similar fashion, putting it in control of hundreds of newspapers across the country. Since May, when Tribune’s sale was officially approved, those papers include storied and award-winning titles: the New York Daily News, the Denver Post, the Chicago Tribune, and many more. While the Tribune sale had its fair share of ups and downs, and journalists attempted to fight back, Alden ultimately prevailed.

It’s unclear if this time will be any different. Still, so far, Lee Enterprises has put up a respectable fight. Last Friday, Lee’s board rejected all of Alden’s nominees, noting in a news release, “Alden’s hasty and convoluted attempt to work around our simple and common procedure on the eve of the nomination deadline does not meet the clear requirements of Lee’s bylaws. Alden’s failure is entirely of its own making. Alden is not entitled to invent its own process for its convenience.”

On Wednesday, Harris Kupperman, Lee’s second-largest shareholder, wrote in a letter to fellow board members that Alden’s acquisition offer is “clearly insufficient and opportunistic, grossly undervaluing the company.” In an interview with NPR’s Midwest Newsroom, Kupperman elaborated. “You need to protect the newsroom so you can have a product,” he said. “As a shareholder, I see this being a long-term investment. If you have a quality product, you have more subscriptions and you can hire more journalists.”

Yesterday morning, the newspaper chain’s board unanimously rejected Alden’s offer, in language that mirrored Kupperman’s. “Lee’s Board determined that Alden’s proposal grossly undervalues Lee,” the board wrote, “and is not in the best interests of the Company and its shareholders.” 

Alden’s proposal is also not in the best interest of American journalism. The hedge fund is notorious for buying newspapers then slashing jobs and consolidating operations in order to turn a quick profit. (In a recent article, NiemanLab’s Josh Benton referred to Alden as “a cost-cutting omnivore that makes every newsroom it touches worse,” and “King Midas in reverse.”) “They don’t care one way or the other about journalism,” Neil Chase, who used to be the top editor at an Alden paper, told me last year. “It’s all about the spreadsheets and the numbers.”

Sign up for CJR's daily email

Below, more on Alden and the business of local news:

  • Tribune’s unions put out a statement warning against what Alden ownership means for its newspapers’ communities, writing that its staff are “down by an average of 20%.” It continues: “Every newsroom… has lost reporters, editors, designers, photographers and other workers, leaving entire swaths of our already underserved communities intentionally ignored.” It concludes with a “demand that Lee put service to its communities ahead of a naked grab for fleeting profit margins—and to take the opportunity to protect the newspapers of Lee from destruction by Alden.”  
  • While ownership by Alden is a worst-case scenario for many newspaper employees, Lee Enterprises––which owns newspapers in metropolises across the country, from Buffalo, New York, to St. Louis, Missouri, to Casper, Wyoming––hasn’t exactly been a beacon of hope either. Many of the newspapers that Lee now owns used to be owned by Warren Buffett’s Berkshire Hathaway, which sold the papers to Lee for $140 million in 2018. Those papers, the Washington Post writes, “saw major cuts following the Lee takeover.” In October 2020, Poynter tallied fifty layoffs at Lee-owned papers during the pandemic, when many newspapers were cutting staff. 
  • Also in October 2020, WVTF—a Roanoke, Virginia-based NPR affiliate—interviewed Ashley Spinks, who was then the sole full-time staff member at the Floyd Press, a Lee newspaper also in Virginia. The article noted that Lee had “fired reporters, outsourced work, and furloughed staff.” Days later, WVTF reported that Spinks had been fired: “She says one reason management cited was that she gave this interview and that she made ‘disparaging comments’ about Lee Enterprises.”

Other notable stories:

  • After the Federal Trade Commission said it would increase its enforcement on certain news-industry practices, including procedures that made it difficult to cancel subscriptions. Nieman Lab’s Sarah Scire checked in on whether the announcement forced any papers into action. The result: not really. 
  • The Wirecutter union says that the New York Times withheld their holiday pay in retaliation for their strike. Wirecutter, the Times’s product-review vertical, went on strike from Thanksgiving through Cyber Monday––the US’s major holiday shopping days. The union has asked for a $300,000 increase in total to their unit’s minimum salaries. (Or, as Study Hall put it, “0.029% of the $1 billion the Times recently reported it now has in cash.”) According to the Wall Street Journal, the union’s GoFundMe raised $42,000 during the strike.  
  • Yesterday, the Committee to Protect Journalists released their 2021 prison census, which found that the number of imprisoned journalists has reached a record high: 293, up from 280 last year. “China remains the world’s worst jailer of journalists for the third year in a row” it wrote, with Myanmar coming in second, followed by Egypt, Vietnam, and Belarus. (For more on the press freedom situation in Belarus, read Charles McPhedran’s report for CJR from October.)  
  • This morning, a British court ruled that Julian Assange could be extradited to the United States, where he’s been charged with violating the Espionage Act for his role in making US intelligence documents public. Assange is a controversial figure, but most people concerned with First Amendment rights have criticized the US’s pursuit of spying charges against him.  
  • On Thursday, the Senate Judiciary Committee advanced a bill that would make downloading files from PACER, an electronic court document database, free. PACER has long kept court filings prohibitively expensive, limiting access for many independent journalists and cash-strapped newsrooms. While this ruling does not apply to filings at the state or county level, it would nevertheless be an undeniable win for journalism and government transparency. 
Savannah Jacobson is a contributor to CJR.