Key Takeaways
- • The NewsGuild-CWA formally urged CalPERS and PSERS—two of the nation's largest public pension systems—to divest from Cerberus Capital Management, citing the firm's $218 million loan to hedge fund Alden Global Capital as enabling the destruction of local news.
- • Alden Global Capital, backed by Cerberus financing, has acquired control of MediaNews Group and Tribune Publishing newspaper chains, leading to thousands of job cuts, newsroom closures, and asset-stripping tactics that have weakened local news coverage across the United States.
- • NewsGuild President Jon Schleuss has escalated pressure on Cerberus, including a direct nine-page letter to founder Stephen Feinberg in July 2021 requesting disclosure of loan terms and citing Alden's adverse impact on journalism critical to democratic institutions.
- • The divestment campaign targets public pension fund holdings in Cerberus on the grounds that such investments are financially complicit in business practices that reduce journalistic capacity and community access to local information.
Summary
The NewsGuild-CWA, the union representing media industry workers, launched a formal divestment campaign on September 20, 2021, targeting Cerberus Capital Management's role in financing the consolidation and cost-cutting of major newspaper chains. In letters addressed to the California Public Employees' Retirement System (CalPERS) and the Pennsylvania Public School Employees' Retirement System (PSERS), NewsGuild President Jon Schleuss argued that public pension fund investments in Cerberus are "enabling the destruction of local news" by supporting the firm's relationship with hedge fund Alden Global Capital.
The financial nexus at issue centers on a $218 million loan that Cerberus extended to Alden Global Capital, enabling the hedge fund to acquire control of Tribune Publishing in May 2021. According to Schleuss's correspondence, Alden has systematically reduced newsroom capacity and eliminated thousands of journalism positions across its portfolio companies, including MediaNews Group and Tribune Publishing. Schleuss characterized these actions as an "asset-stripping" strategy designed to extract value from news operations rather than sustain journalistic output, resulting in diminished local news coverage and reduced access to information for communities nationwide.
NewsGuild escalated its pressure campaign in July 2021 when Schleuss sent a nine-page letter directly to Cerberus founder Stephen Feinberg, requesting public disclosure of the loan terms and documenting Alden's operational changes across its newspaper properties. The union's concern extends beyond immediate employment impact; Schleuss argued that Alden's practices have "undermined news coverage critical to American democracy." The organization's previous president, Bernie Lunzer, had similarly raised concerns with Feinberg in 2019, establishing this as a sustained institutional position rather than isolated criticism.
The divestment push represents an effort to leverage institutional capital stewardship as a mechanism for influencing private equity finance flows into media consolidation. By targeting two major public pension systems—CalPERS and PSERS represent substantial asset bases—the NewsGuild seeks to create reputational and financial pressure on Cerberus by reducing pension fund exposure to the firm. The campaign reflects broader institutional scrutiny of private equity's role in leveraged restructuring of asset-heavy industries, particularly where operational changes may conflict with stakeholder interests or broader social considerations.
The financial nexus at issue centers on a $218 million loan that Cerberus extended to Alden Global Capital, enabling the hedge fund to acquire control of Tribune Publishing in May 2021. According to Schleuss's correspondence, Alden has systematically reduced newsroom capacity and eliminated thousands of journalism positions across its portfolio companies, including MediaNews Group and Tribune Publishing. Schleuss characterized these actions as an "asset-stripping" strategy designed to extract value from news operations rather than sustain journalistic output, resulting in diminished local news coverage and reduced access to information for communities nationwide.
NewsGuild escalated its pressure campaign in July 2021 when Schleuss sent a nine-page letter directly to Cerberus founder Stephen Feinberg, requesting public disclosure of the loan terms and documenting Alden's operational changes across its newspaper properties. The union's concern extends beyond immediate employment impact; Schleuss argued that Alden's practices have "undermined news coverage critical to American democracy." The organization's previous president, Bernie Lunzer, had similarly raised concerns with Feinberg in 2019, establishing this as a sustained institutional position rather than isolated criticism.
The divestment push represents an effort to leverage institutional capital stewardship as a mechanism for influencing private equity finance flows into media consolidation. By targeting two major public pension systems—CalPERS and PSERS represent substantial asset bases—the NewsGuild seeks to create reputational and financial pressure on Cerberus by reducing pension fund exposure to the firm. The campaign reflects broader institutional scrutiny of private equity's role in leveraged restructuring of asset-heavy industries, particularly where operational changes may conflict with stakeholder interests or broader social considerations.
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