CHICAGO (AP) — 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. The hedge fund owns one of the country’s largest newspaper chains; its papers include the Boston Herald, the Denver Post and the San Jose Mercury News.
The Baltimore Sun is not included in the 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. Slaine and a representative for Soon-Shiong did not immediately respond to requests for comment on Tuesday.
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.
Tribune journalists have spoken up about their fears of Alden’s influence and control over their papers. Alden is known for slashing costs and shrinking newsrooms at the newspapers it acquires to squeeze out profits. It is behind the MediaNews Group, which owns the Boston Herald, the Denver Post and dozens of other papers.
The unions at Tribune papers have pushed for alternative buyers for the company’s papers.
The newspaper industry has been consolidating as it struggles with a digital transition and shrinking revenues. Newsroom jobs fell by nearly half from 2004 to 2018, according to Pew Research. The pandemic has exacerbated those stresses. Tribune’s chief financial officer said in November that the company has been “aggressively” cutting costs during the pandemic, including furloughs, pay cuts and closing its newsrooms.
In a statement, Alden said: “Our commitment to ensuring the sustainability of robust local journalism is well established and this is part of that effort.”
This story has been corrected to note the sale price is $630 million, not $630 billion