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Who owns Alden Global Capital? Hedge fund known for steep budget cuts to buy Tribune Publishing in $630m deal

Shareholders approved the acquisition by Alden, which already owns about 200 other papers. Journalists called it a 'sad sobering day'

Tribune Publishing, home to some of America's most popular newspapers and digital outlets has agreed to be acquired by Alden Global Capital. The hedge fund, known for its aggressive cost-cutting measures will take Tribune private after the deal worth $630 million was approved by Tribune's shareholders. 

In December 2019, Alden purchased a 32% stake in the company and will now take over it entirely. Alden has welcomed the news, saying, "the purchase of Tribune reaffirms our commitment to the newspaper industry and our focus on getting publications to a place where they can operate sustainably over the long term." Unfortunately, it seems like those directly affected, the journalists, have a very different view.

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Many have taken to social media to condemn the purchase while some news guilds have issued statements accusing Tribubne's shareholders of putting "profit and greed over local news." Why the opposition? it may have to do with Alden's Managing Director (MD) - Heath Freeman and its own Randall Smith.

Who owns Alden Capital?

The hedge fund was founded by Randall Smith in 2007, but is managed by Health Freeman. Not much is known about both men, who keep a relatively low profile. But their names have often struck fear for local businesses. Together, the duo has purchased many local businesses (notably media outlets) and bleed them dry, often leading to bankruptcies. An old story about Smith says "He’s not a man who’s ever showed an interest in protecting journalism." 

That 2017 story says Smith "has done this deliberately", and calls him a specialist in "vulture investments". He is known to be averse to the public, so much so that there's only one photo of him in existence. Because he privately owns many businesses, his net worth is unclear, according to the story. It adds, "He’s also fond of offshore locations, headquartering companies in the Isle of Jersey and the Cayman Islands — well-known as tax secrecy havens. Any corporate paper trails there, too, quickly lead to dead ends."

We know Smith graduated from Cornell and Wharton Business School and joined his brother Russ in taking over media outlets. Before that, Smith spent the 1970s working in Wall Street, and even started his own investment firm in 1985. The firm, R.D. Smith & Company had a distinct strategy: “profiting from other people’s misery,” according to a 1991 New York Times article. 

In 1991, his methods attracted the interest of the Securities and Exchange Commission (SEC), but he quickly stepped away before they could pin anything on him. In 2007, he founded Alden and invested in debt-ridden economies like Greece and Argentina. He started buying media outlets around 2009 and began driving them to bankruptcy. Details are scarce, but Alden reportedly owns around 200 papers all over the US. That work is now being continued by Heath, who joined Alden in 2006. 

Even less is known about Freeman. A 2016 feature in the Denver Post described him as " as aggressive and highly intelligent, flinty-eyed and focused, and a man who has no real affinity for newspapers." Like his mentor Smith, Freeman doesn't do interviews and is rarely seen in public. The one biography we found of him says he attended Duke University and initially worked as an investment banker. The biography says, "By 2009 — a year when many Americans were stung by the recession — Freeman was living a lavish, Manhattan-penthouse life, with sprawling digs on Central Park South and the West Village."

Together, the duo have run several papers into the ground, notably through Digital First Media (DFM) which has seen massive layoffs in the past. 

Journalists 'deeply concerned'

Following the news of the takeover, journalists took to social media to slam the acquisition. One reporter tweeted, "We are all deeply concerned by Alden Global Capital's purchase of Tribune Publishing. It is a sad, sobering day for journalism, @chicagotribune and the city we love. But we will continue to fight for a better newsroom and each other @ctguild."

Congressional candidate Marie Newman tweeted, "I'm disappointed in Alden’s purchase of the @chicagotribune. I have little faith in a union-busting hedge fund giving orders to journalists across our great city. To all those who work at the Tribune, keep fighting for fair wages and a seat at the table." Another user tweeted, "With Alden Capital's acquisition today of Tribune Co, our nation today reached an ominous milestone: half of the daily newspaper circulation is owned by hedge funds. We can't rebuild local news if we don't confront this tragic fact."

"A very bad day for local news. Alden Capital’s acquisition of @tribpub was just approved by shareholders. The Alden playbook- buy low, cut deeper- could not be worse for a #localnews and the communities it serves. Another reason to re-double our efforts," said one person.

Despite the strong opposition, the purchase is done and a change of guard at Tribune Publishing will take place very soon. The purchase comes at a trying time for media outlets, which have been suffering from sharply reduced advertising revenue for years thanks to tech giants like Facebook and Google.