A hedge fund that has a major interest in Tribune Publishing Co.
TPCO 0.31%
is looking into the newspaper chain behind titles like the Chicago Tribune and New York Daily News, according to people familiar with the case.
Alden Global Capital LLC, which is already Tribune’s largest shareholder with a 32% stake, could announce an offer for the company on Thursday, the people said. Details of the potential offer could not be found.
Tribune has a market value of about $ 470 million after years of decline as the outlook for local newspapers diminishes. Shares have changed little this year, closing at $ 12.79 on Wednesday.
A deal would have far-reaching implications for an industry plagued by sharp sales declines over the past 20 years, which have led to a wave of consolidation and cost savings. According to the Pew Research Center, the industry lost 51% of newsroom jobs between 2008 and 2019.
Tribune Publishing, one of the largest newspaper chains in the country by circulation, publishes nine major daily newspapers, including the Baltimore Sun, Orlando Sentinel and Hartford Courant.
Alden controls MediaNews Group, a privately held company that owns some 60 daily newspapers nationwide, including the Denver Post, San Jose Mercury News, and Orange County Register. The hedge fund has a reputation for making significant cost savings on securities it acquires.
In July, Alden cemented a firmer position on the Tribune board by gaining control of one-third of the seven seats in exchange for an agreement to renew a standstill agreement that would prevent the hedge fund from increasing its stake or making a hostile bid releases until after June 2021.
Consequently, any deal to increase stake would likely need to be signed by Tribune or a significant portion of the shareholders not affiliated with Alden. The company’s second largest shareholder, at about 25%, is Patrick Soon-Shiong, a billionaire biotech investor who bought Tribune’s Los Angeles Times in 2018 for $ 500 million.
With the industry reeling from the economic fallout from the coronavirus pandemic, Tribune has fired dozens of reporters and closed many of its newsrooms completely to save on real estate costs. Earlier in December, Tribune agreed to sell its e-commerce business, Best Reviews, to Nexstar Media Group Inc.
for $ 160 million.
Write to Cara Lombardo at [email protected], Dana Cimilluca at [email protected] and Lukas I. Alpert at [email protected]
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Appeared in the print edition of December 31, 2020 as ‘Fund seeks to completely buy stand chain’.