Alden Global Capital, the largest shareholder of Tribune Publishing, said Thursday it offered to take full control of the newspaper chain in a deal that values the company at $520.6 million.
Tribune Publishing owns the Chicago Tribune, the New York Daily News and the Baltimore Sun, among other local newspapers.
The hedge fund made a non-binding proposal to buy the company for $14.25 per share, according to a filing with the Securities and Exchange Commission on Thursday. The potential deal represents an 11% premium to the company’s last closing price on Wednesday of $12.79.
“We believe that, as a private company, Tribune would be able to unlock significant strategic and financial value, thereby allowing us … to make an offer to acquire all of the common stock of Tribune not already owned by Alden,” the hedge fund said.
The Wall Street Journal was the first to report news of the bid.
In June, Alden acquired a third seat on Tribune Publishing’s board in exchange for a standstill agreement with the newspaper chain. The agreement prevents Alden from increasing its stake for the company until June 2021.
Alden currently has a 32% ownership stake in the Tribune, which it purchased in November 2019. Alden has long been criticized for buying stakes in newspaper companies and then cutting newsroom jobs. It already owns roughly 200 newspapers through its majority stock of MediaNews Group, which includes the Denver Post, the Mercury News and the Boston Herald.
Alden said in a letter to the Tribune Publishing board that it was ready to move on the deal immediately.
Tribune did not immediately respond to a request for comment.
“Alden has made a fortune by destroying local news,” said NewsGuild-CWA President Jon Schleuss on Thursday. “They fashion short-term business plans that cut newsrooms to the bone … Our thousands of members will continue to fight hedge fund ownership of local news.”
In a petition last December to the Tribune Publishing board, hundreds of Tribune employees, said that Alden has a “well-documented history of extracting short-term profits from already-lean operations by cutting newsroom jobs and denying fair wages and benefits.