He used his own money to pull court records, and went years without going on a vacation. And when Chicago suffered a brutal summer crime wave, the paper had no one on the night shift to listen to the police scanner. It turned out that those ownersNew York hedge funders whom Glidden took to calling the lizard peoplewere laser-focused on increasing the papers profit margins. Tribune Publishing, publisher of the Chicago Tribune and other major newspapers, has agreed to be acquired by Alden Global Capital in a deal valued at $630 million . When The New York Times profiles him in 1991, it notes that he excels at profiting from other peoples misery and quotes a parade of disgruntled clients and partners. Its a game, Randy explains to his son. At one point, I tracked down the photographer whod taken the only existing picture of Smith on the internet. For Baltimore to avoid a similar fate, Simon told me, something new would have to come alonga spiritual heir to the Sun: A newspaper is its contents and the people who make it. And everyone knows its going to run dry.. Plus how Facebook is a hostile foreign power, the engineers daughter, the collapse of music genres, Dostoyevsky, W. G. Sebald, nasty return logistics, and more. (Freeman denied this characterization through a spokesperson. Researchers at the University of North Carolina found that Alden-owned newspapers have cut their staff at twice the rate of their competitors; not coincidentally, circulation has fallen faster too, according to Ken Doctor, a news-industry analyst who reviewed data from some of the papers. A month after he started, one of his fellow reporters left and Glidden was asked to start covering schools in addition to his other responsibilities. They are also defined by an obsessive secrecy. For Smith, the Palm Beach conservative and Trump ally, sticking it to the mainstream media might actually be a perk of Aldens strategy. To find the papers current headquarters one afternoon in late June, I took a cab across town to an industrial block west of the river. Alden Global Capital is a hedge fund based in Manhattan, New York City. You could look to Oakland, California, where the East Bay Times laid off 20 people one week after the paper won a Pulitzer. Alden Global Capital owns 56 dailies under Digital First Media (Alden also owns 32% of Tribune 10 dailies in Column C.) Tribune Media owns 10 dailies. He can cite decades-old scoops and tell you whom they pissed off. "The question is, will local communities decide that this is an important issue, that it's worth saving these newspapers, protecting them from firms like Alden, or will they decide that they don't really care?" [30], Alden Global Capital includes a real estate division called Twenty Lake Holdings, which primarily buys excess real estate from newspapers. "A lot of cities almost operate with the assumption that there will be at least one local newspaper, in some cases several local newspapers, acting as a check on the authorities," he says. . Instead, they gutted the place. While some finance reporters noted that Smiths newspaper investments were all losing value, none seemed to notice that Smith and Aldens president Heath Freeman would soon start strip mining their news companies real estate and other assets. Coordinated by . If accepted, the $24 per share purchase price would . This company that owns us now seems to still be prettyI dont even know how to put it, the editor said, according to a recording of the meeting obtained by The Atlantic. He quotes H. L. Mencken, the papers crusading 20th-century columnist, on the joys of journalism: It is really the life of kings. Freeman never responded. Baltimore has always had its problems, he told me. But whats happening in Chicago is different. Much of the Knight family's once-grand newspaper empire was ultimately acquired by Alden Global Capital, while the family foundation invested in Alden funds. October 14, 2021. When a local newspaper vanishes, research shows, it tends to correspond with lower voter turnout, increased polarization, and a general erosion of civic engagement. Or to nearby Monterey, where the former Herald reporter Julie Reynolds says staffers were pushed to stop writing investigative features so they could produce multiple stories a day. Convinced that the Sun wont be able to provide the kind of coverage the city needs, he has set out to build a new publication of record from the ground up. On more than one occasion, according to people I spoke with, he asked aloud, What do all these people do? According to the former executive, Freeman once suggested in a meeting that Aldens newspapers could get rid of all their full-time reporters and rely entirely on freelancers. I asked. The details of how Smith got to know him are opaque, but the resulting loyalty was evident. Read: Local news is dying, and Americans have no idea, From 2015 to 2017, he presided over staff reductions of 36 percent across Aldens newspapers, according to an analysis by the NewsGuild (a union that also represents employees of The Atlantic). Tuesday, 23 November 2021 07:46 PM EST. If you're a reader of local newspapers particularly the Chicago Tribune, The Baltimore Sun or New York Daily News you're going to want to make sure the answer is yes. Reporters kept reporting, and editors kept editing, and the union kept looking for ways to put pressure on Alden. A spokesman took issue with the entirety of the story, and laid out a long list of questions attacking the integrity of the reporter, The Atlantic and some of his sources without addressing some of the more specific claims within the report. On . "[26] Shortly thereafter, Alden Global, through its operating unit Strategic Investment Opportunities, filed a lawsuit in state court in Delaware against Lee Enterprises. Probably not.. Here was one of Americas most storied newspapersa publication that had endorsed Abraham Lincoln and scooped the Treaty of Versailles, that had toppled political bosses and tangled with crooked mayors and collected dozens of Pulitzer Prizesreduced to a newsroom the size of a Chipotle. But in the case of local news, nothing comparable is ready to replace these papers when they die. I asked if anyone there at the time was aware of Aldens vulture business strategy. So Freeman pivoted. It is a subsidiary of Alden Global Capital, the New York City hedge fund that backed the purchase of and dramatic cost-cutting at more than 100 newspapers causing more than 1,000 lost jobs. Located in the same Manhattan office building as Alden, it funds stem-cell research, health-related charities, arts and culture and Duke University, alma mater of Smiths protg Heath Freeman. Updated May 21, 2021 at 2:13 PM ET. According to Aldens scarce SEC filings, it currently has fewer than 10 investors, most of them from overseas. But who most of those few souls are, and how much of the hundreds of millions skimmed from DFM papers theyve received remains a deep, dark mystery. Some in the city started to wonder if the paper was even worth saving. Alden completed its takeover of the Tribune papers in May. Eventually he was the only news reporter left on staff, charged with covering the citys police, schools, government, courts, hospitals, and businesses. Hedge fund Alden Global Capital will acquire the rest of what it does not already own of Tribune Publishing, owner of the Chicago Tribune, the New York Daily News and other local newspapers, in a . The newspaper lost a quarter of its staff to buyouts after it was acquired by Alden Global Capital in May. In addition to the constant layoffs, our buildings were being sold, basic office supplies became scarce and the hot water stopped working. [22] The appointees to the MediaNews board were replaced by new directors representing the stockholders group led by Alden Global Capital. Yes, today, it's a newspaper without a newsroom. They had a father-figure relationship, one told me. In my many conversations with people who have worked with Freeman, not one could recall seeing him read a newspaper. This investment strategy does not come without social consequences. He was fired after criticizing Alden in a Washington Post interview. Last week, Alden Global Capital, the hedge fund notorious for slashing costs at its local titles, came down on the No side of the question, with editorial boards at papers that it owns stating that they will no longer endorse candidates for governor, US senator, or president. The men who devised this model are Randall Smith and Heath Freeman, the co-founders of Alden Global Capital. But by 2014, it was becoming clear to Aldens executives that Patons approach would be difficult to monetize in the short term, according to people familiar with the firms thinking. He gained 100 pounds and started grinding his teeth at night. When the city-hall reporter left a few months later, he picked up that beat too. You have no way of knowing that if you dont have some nosy son of a bitch asking a lot of questions down there, he told me. My question was did Knight know what Alden was doing to newspapers when it invested with the hedge fund, and does it regret that investment now? NPR's A Martnez talks to McKay Coppins of The Atlantic about how a hedge fund, Alden Global Capital, is buying and then gutting newspapers and the implications for democracy. Some of these papers likely would have been liquidated if the fund had not stepped in to buy them, as Alden's president told Coppins. Next year, Bainum will launch The Baltimore Banner, an all-digital, nonprofit news outlet. Now he was feeling the effects of their management. Coppins offers several examples, like the Chicago Tribune and California's Vallejo Times-Herald. Tips that he would never have time to investigate piled up on a legal pad he kept at his desk. By the charitys own accounting, it lost $ 2.3 million in book value on a $17 million investment that year. Interestingly, Smiths foundation didnt do well with its Alden investments in 2016. The families that used to own the bulk of Americas local newspapersthe Bonfilses of Denver, the Chandlers of Los Angeleswere never perfect stewards. In conversations with former Alden employees, I heard repeatedly that their partnership seemed to transcend business. The model is simple: Gut the staff, sell the real estate, jack up subscription prices, and wring as much cash as possible out of the enterprise until eventually enough readers cancel their subscriptions that the paper folds, or is reduced to a desiccated husk of its former self. Otherwise, youre just peeing in the ocean.. [13], Newspapers in Alden's portfolio include Chicago Tribune, The Denver Post, the St. Paul Pioneer Press, the Boston Herald, The Mercury News, East Bay Times, The Orange County Register, and Orlando Sentinel. The question was how. Some expressed exasperation with the staff of the Chicago Tribune, who were unable to find a single interested local buyer. When plans for the building were announced in 1922, Colonel Robert R. McCormick, the longtime owner of the Chicago Tribune, said he wanted to erect the worlds most beautiful office building for his beloved newspaper. [32], The company has been criticized for investing money for pensions of newspaper employees in funds it manages itself. The hollowing-out of the Chicago Tribune was noted in the national press, of course. Freeman, his 41-year-old protg and the president of the firm, would be unrecognizable in most of the newsrooms he owns. But in the meantime, there isn't really anything that can fill the hole these newspapers will leave if they're shut down. If Knights total divestment from Alden in 2014 was because someone made an ethical decision to stop dealing with the vulture fund, good for them. When he did, he exhibited a casual contempt for the journalists who worked there.