Key Takeaways
- • Alden Global Capital has secured a 32% stake in Tribune Publishing following a $118 million acquisition of shares from former board chair Michael W. Ferro, positioning the hedge fund for a potential full takeover by mid-2020.
- • A standstill agreement through June 30, 2020, aligned with the expiration of a separate standstill with second-largest shareholder Dr. Patrick Soon-Shiong (who holds ~25% of Tribune shares), suggests Alden may be positioning to acquire Soon-Shiong's stake and complete majority control.
- • Tribune Publishing owns eight major regional newspapers including the Chicago Tribune, Baltimore Sun, Hartford Courant, and New York Daily News—substantially expanding Alden's existing Digital First Media portfolio of over 200 outlets.
- • Historical precedent from Alden's Digital First Media operations indicates potential real estate liquidation (sale of printing plants, offices, and land) and increased debt financing, strategies the hedge fund has employed to extract liquidity from newspaper properties.
- • Tribune's current largely debt-free balance sheet contrasts sharply with Alden's typical capital structure for acquired media companies, suggesting material leverage and asset monetization risks under full Alden control.
Summary
Alden Global Capital has moved aggressively to position itself for a controlling stake in Tribune Publishing, one of the largest newspaper chains in the United States. In late November 2019, the New York hedge fund acquired 9.07 million shares from Michael W. Ferro, Tribune's former board chair, for approximately $118 million. The purchases were executed through Alden Global Opportunities Master Fund, L.P. and Alden Global Value Recovery Master Fund, L.P., two Cayman Islands-based investment vehicles. Subsequent share purchases brought Alden's total ownership to around 32% of Tribune Publishing within days, according to SEC filings cited in the primary reporting.
The timing and structure of Alden's transaction suggest a calculated path toward full acquisition. The hedge fund negotiated a standstill agreement with Tribune's board that prevents additional share purchases until June 30, 2020. Notably, this date coincides with the expiration of a separate standstill agreement with Dr. Patrick Soon-Shiong, Tribune's second-largest shareholder, who controls just under 25% of the company. The alignment of these two standstill expirations has triggered speculation among market observers that Alden may be positioning to acquire Soon-Shiong's shares following June 30, which would likely secure majority control of Tribune Publishing.
Tribune's newspaper portfolio spans major metropolitan markets and includes the Chicago Tribune, The Baltimore Sun, The Hartford Courant, the New York Daily News, The Virginian-Pilot, the Daily Press, and the Allentown Morning Call, among others. This would represent a substantial expansion of Alden's existing newspaper footprint through its Digital First Media division, which already operates the Denver Post, San Jose Mercury News, East Bay Times, St. Paul Pioneer Press, Boston Herald, and Orange County Register, among dozens of other local publications.
Industry observers have flagged two principal financial risks associated with an Alden takeover of Tribune. First, Alden has a documented track record of liquidating real estate holdings—including printing plants, office buildings, and land—at newspapers it controls, deploying proceeds to fund operations and external investments. Second, Tribune currently operates with minimal debt, contrasting sharply with the highly leveraged capital structures Alden typically imposes on acquired media properties. A full Alden acquisition could trigger significant debt issuance to finance the takeover itself, increasing Tribune's financial obligations while simultaneously pressuring asset values through real estate sales.
The timing and structure of Alden's transaction suggest a calculated path toward full acquisition. The hedge fund negotiated a standstill agreement with Tribune's board that prevents additional share purchases until June 30, 2020. Notably, this date coincides with the expiration of a separate standstill agreement with Dr. Patrick Soon-Shiong, Tribune's second-largest shareholder, who controls just under 25% of the company. The alignment of these two standstill expirations has triggered speculation among market observers that Alden may be positioning to acquire Soon-Shiong's shares following June 30, which would likely secure majority control of Tribune Publishing.
Tribune's newspaper portfolio spans major metropolitan markets and includes the Chicago Tribune, The Baltimore Sun, The Hartford Courant, the New York Daily News, The Virginian-Pilot, the Daily Press, and the Allentown Morning Call, among others. This would represent a substantial expansion of Alden's existing newspaper footprint through its Digital First Media division, which already operates the Denver Post, San Jose Mercury News, East Bay Times, St. Paul Pioneer Press, Boston Herald, and Orange County Register, among dozens of other local publications.
Industry observers have flagged two principal financial risks associated with an Alden takeover of Tribune. First, Alden has a documented track record of liquidating real estate holdings—including printing plants, office buildings, and land—at newspapers it controls, deploying proceeds to fund operations and external investments. Second, Tribune currently operates with minimal debt, contrasting sharply with the highly leveraged capital structures Alden typically imposes on acquired media properties. A full Alden acquisition could trigger significant debt issuance to finance the takeover itself, increasing Tribune's financial obligations while simultaneously pressuring asset values through real estate sales.
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