Alden Global Capital wants to buy owner of Waynesboro newspaper

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WAYNESBORO – A hedge fund that recently took over newspaper chain Tribune is now trying to take over the company which publishes 77 newspapers across the country, including a daily in Waynesboro.

Alden Global Capital announced last week that it had made an unsolicited offer to add Lee Enterprises Inc. under its umbrella which also includes Tribune Publishing Co. and MediaNews Group Inc. According to a statement released by the company, one of its subsidiaries owns already 6% share in Lee.

The deal as announced is a cash proposal of $ 24 per share, which Alden said represented a premium of around 30% to current Lee shareholders last Friday.

“Our interest in Lee is a reaffirmation of our substantial commitment to the newspaper industry and our desire to support local newspapers for the long term,” Alden said in a statement.

The Lee chain includes The News-Virginian in Waynesboro, The Daily Progress in Charlottesville, and the Richmond Times-Dispatch. Lee purchased these newspapers, along with several others, last year from BH Properties.

A phone message left at Lee’s Iowa headquarters has yet to be returned. However, the company released its own statement on Nov. 24 that its board of directors had crafted a “rights plan” in an effort to deter Alden’s takeover. The plan, called the “poison pill” in the financial industry, would allow current shareholders to buy more shares at a 50% discount after December 6, making it more difficult for Alden to take control.

This plan will only kick in if Alden manages to increase his stake in Lee from 6% to 10% by early December.

Alden has a reputation for cutting costs and labor at its newsagents, according to the Poynter Institute. When it bought Tribune last summer, it immediately started cutting newsroom staff and selling real estate.

“The hedge fund has earned a reputation for slashing staff in newsrooms and other departments and selling real estate through outlets it owns,” said Rick Edmunds of Poynter. written Nov 22 on Poynter website. “He announced cuts to Tribune as soon as the deal was struck. In addition to investing little in news, he lags the industry in technology upgrades.”

NPR’s David Folkenflik called Alden a “vulture fund” in a column last May, when the company announced the takeover of Tribune.

With the takeover of Tribune, Alden became the second largest newspaper company in the United States behind Gannett, whose properties in Virginia include USA TODAY, The News Leader and The Progress-Index in Petersburg. Gannett contracted with Lee to manage the distribution and printing operations of his Staunton and Petersburg newspapers.

In addition to the Waynesboro, Charlottesville, and Richmond newspapers, Lee’s other Virginia holdings include Bristol, Culpeper, Fredericksburg, Lynchburg, Martinsville, and Rocky Mount.

If the sale was successful, Alden would own newspapers in most of the Virginia metropolitan areas. Through its purchase of Tribune, the company took over The Virginian-Pilot in Norfolk and the Daily Press in Newport News. When he announced his plans, Alden said he expected the deal to be done by the end of the year.

As of late Monday morning, Lee’s shares were trading at $ 25.30 a share.

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Bill Atkinson (he / him / her) is the Daily News Coach for USA TODAY’s Unified Central Southeast Region, which includes Virginia, West Virginia and central North Carolina. He is based in Petersburg, Virginia. Contact him at [email protected]

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