Key Takeaways
- • Alden Global Capital's $633 million acquisition of Tribune Publishing was approved by shareholders on Friday, May 21, with 81.28% of non-Alden stockholders voting in favor, exceeding the required two-thirds threshold for deal closure.
- • The transaction will take Tribune Publishing private and position Alden as the second-largest newspaper owner in the U.S. behind Gannett, adding the Chicago Tribune, Baltimore Sun, and other major dailies to its existing portfolio of approximately 200 local newspapers.
- • Patrick Soon-Shiong, the California biotech billionaire and Los Angeles Times owner who holds 23.7% of Tribune Publishing, will receive approximately $150 million in sale proceeds from his 8.7 million shares despite claiming to have abstained from the vote.
- • Deal closure is expected by Tuesday, May 25, 2021, with Alden's $633 million offer fully financed; the hedge fund also has access to Tribune Publishing's cash on hand and reserved the right to utilize it.
- • The vote outcome hinged on the treatment of Soon-Shiong's proxy ballot, which had no box checked for "for," "against," or "abstain"—resulting in it being automatically counted as a "yes" vote per standard proxy voting instructions, despite his stated abstention.
Summary
Alden Global Capital secured shareholder approval to acquire Tribune Publishing for $633 million on Friday, May 21, clearing a critical regulatory hurdle for the hedge fund's consolidation strategy in the newspaper industry. The vote tallied 81.28% approval among non-Alden stockholders, exceeding the two-thirds threshold required for the deal. Tribune Publishing expects the transaction to close by May 25, 2021, taking the company private and significantly expanding Alden's media footprint.
The acquisition will add major publications including the Chicago Tribune and Baltimore Sun to Alden's existing portfolio of approximately 200 local newspapers, positioning the New York-based hedge fund as the second-largest newspaper owner in the United States, behind only Gannett. Alden already owned nearly one-third of Tribune Publishing prior to the vote, giving it substantial influence over the outcome. The deal is fully financed, and Alden has additionally reserved the right to utilize Tribune Publishing's cash on hand to support operations post-acquisition.
The vote's success was materially dependent on the handling of Patrick Soon-Shiong's proxy ballot. Soon-Shiong, a California biotech billionaire and Los Angeles Times owner, controls 23.7% of Tribune Publishing's 36.9 million outstanding shares and stands to receive approximately $150 million in sale proceeds from his 8.7 million shares. His spokeswoman stated he had "abstained" from the vote; however, Tribune Publishing confirmed that Soon-Shiong's proxy ballots were submitted without any box checked for "for," "against," or "abstain." Under standard proxy voting instructions, ballots submitted with no box marked are automatically counted as votes in support of the board's recommendation—resulting in Soon-Shiong's shares being tallied as affirmative votes despite his stated abstention. This procedural treatment proved decisive to achieving the required supermajority approval.
The deal faced resistance from Tribune Publishing employees and newspaper staff prior to the vote, reflecting concerns associated with Alden Global Capital's industry reputation for implementing aggressive cost-reduction measures, including significant newsroom cuts at properties it has acquired. The hedge fund's acquisition strategy has been characterized as controversial within journalism circles, though institutional investors have monitored its consolidation plays for potential operational efficiencies and return profiles in the challenged print media sector.
The acquisition will add major publications including the Chicago Tribune and Baltimore Sun to Alden's existing portfolio of approximately 200 local newspapers, positioning the New York-based hedge fund as the second-largest newspaper owner in the United States, behind only Gannett. Alden already owned nearly one-third of Tribune Publishing prior to the vote, giving it substantial influence over the outcome. The deal is fully financed, and Alden has additionally reserved the right to utilize Tribune Publishing's cash on hand to support operations post-acquisition.
The vote's success was materially dependent on the handling of Patrick Soon-Shiong's proxy ballot. Soon-Shiong, a California biotech billionaire and Los Angeles Times owner, controls 23.7% of Tribune Publishing's 36.9 million outstanding shares and stands to receive approximately $150 million in sale proceeds from his 8.7 million shares. His spokeswoman stated he had "abstained" from the vote; however, Tribune Publishing confirmed that Soon-Shiong's proxy ballots were submitted without any box checked for "for," "against," or "abstain." Under standard proxy voting instructions, ballots submitted with no box marked are automatically counted as votes in support of the board's recommendation—resulting in Soon-Shiong's shares being tallied as affirmative votes despite his stated abstention. This procedural treatment proved decisive to achieving the required supermajority approval.
The deal faced resistance from Tribune Publishing employees and newspaper staff prior to the vote, reflecting concerns associated with Alden Global Capital's industry reputation for implementing aggressive cost-reduction measures, including significant newsroom cuts at properties it has acquired. The hedge fund's acquisition strategy has been characterized as controversial within journalism circles, though institutional investors have monitored its consolidation plays for potential operational efficiencies and return profiles in the challenged print media sector.
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