Tribune Journalists Are Close To an Improbable Win in Quest for New Owners

By Gerry Smith

‎April 6, 2021, 6:49 PM EDT

► Rival bid for Tribune may derail hedge fund’s planned takeover

► Journalists seek out local buyers for other Tribune newspapers

In January of last year, two Chicago Tribune reporters began looking for a civic-minded investor to rescue the newspaper from what they viewed as the clutches of a notorious hedge fund.

For several months, David Jackson and Gary Marx interviewed more than 100 people in the business and philanthropic world, often making calls from a conference room inside the newsroom. They also published an essay in the New York Times predicting the hedge fund, Alden Global Capital, would create “a ghost version of the Chicago Tribune” -- despite being warned it could get them fired.

Until recently, their efforts appeared to have failed. Alden, which already owns 32% of the company, was poised to take control of Tribune Publishing Co. after agreeing in February to buy the shares it didn’t already own.

“I’d really given up at that point,” said Jackson, who along with Marx has since left the Chicago Tribune.

A few weeks ago, however, the reporters were contacted by a representative of Hansjoerg Wyss, a Swiss billionaire who said he values journalism and was partly inspired to buy the Tribune after reading their essay in the Times.

Jackson and Marx sprung into action, reopening their contact list and making sure everyone who expressed interest in buying Tribune newspapers was in touch.

On Monday, Tribune journalists who have fought Alden’s takeover moved a step closer to an improbable last-minute victory. The company said a $680 million offer from Wyss and Maryland real estate magnate Stewart Bainum Jr. would likely beat out the $635 million offer from Alden. Wyss has said that he doesn’t want to see another truth-telling newspaper go “down the drain.”

“I’m deeply inspired by and grateful for Wyss swooping in at this point and the statement for why he’s done so,” Jackson said. “I’m anxiously watching every development.”

The battle over control of Tribune isn’t over yet. Alden could still raise its offer. And the outcome could depend on Patrick Soon-Shiong, the No. 2 Tribune shareholder. Alden needs approval from two-thirds of the other shareholders. Soon-Shiong declined to comment.

And being owned by a wealthy benefactor isn’t without challenges. Los Angeles Times journalists, for instance, have clashed with Soon-Shiong, who bought that paper in 2018, over a lack of diversity in the newsroom. A steep drop in advertising during the pandemic forced the paper to furlough 40 non-newsroom employees.

But Tribune reporters and editors have already faced furloughs, buyouts and pay cuts under their current owners, and fear things could get worse under Alden, which has reputation for laying off staff to squeeze costs.

The firm didn’t immediately respond to requests for comment.

Newsroom Revolt

Alden owns dozens of newspapers through its subsidiary, Digital First Media. In 2018, one of them, the Denver Post, staged a revolt, publishing a series of articles criticizing the paper’s continued cutbacks. Tribune journalists say they grew alarmed in 2019 when Alden bought out the company’s largest stockholder, Michael Ferro.

Now, the emergence of a rival bid has given new hope to a highly unusual side gig: finding someone to buy their newspaper. From Orlando to Hartford to Allentown, Tribune journalists are trading tips in weekly Zoom meetings on the best ways to seek out new owners. On Wednesday night, they plan to hold an online forum to bring together potential investors and explain their concerns about Alden. Their pleas are also appearing in print.

“If you have deep pockets and want to join efforts to buy the paper,” a Morning Call columnist wrote last month, “I’ll be happy to put you in touch with local people who are working on that.”

Seeking Buyers

If Wyss and Bainum are successful, they would try to find owners for Tribune newspapers like the New York Daily News, Hartford Courant and Virginia’s Daily Press, according to the Chicago Tribune. Under their plan, Wyss would own the Tribune, Bainum the Baltimore Sun and the other papers would be sold to individuals or group owners, the newspaper reported.

New potential investors are emerging. A former investment banker in Manhattan has said he’d offer $30 million to $40 million to buy the Morning Call, which serves Pennsylvania’s Lehigh Valley. Two Florida businessmen, Mason Slaine and Craig Mateer, want to buy the Orlando Sentinel and Sun Sentinel.

Gabrielle Russon, a reporter at the Orlando Sentinel, said she and her colleagues have been inspired by the success of journalists at the Sun, which circulated a petition last year to demand local owners for the paper. The petition was signed by more than 6,000 people, including Baltimore Orioles great Cal Ripken and “The Wire” creator David Simon, who is a former Sun reporter.

“They’ve given us the motivation that we can succeed,” Russon said. “All the unions at Tribune papers are talking and helping each other and brainstorming ideas.”

‘Save Journalism’

Russon and her colleagues have been emailing a list of people and community organizations that might have the money or connections and goodwill “to save journalism.”

Newsrooms have also sought labor protections as they pursue new owners. Last year, the Orlando Sentinel formed a union, which Russon said offers “an ability to advocate for ourselves in a way we didn’t have before.”

Over the weekend, the Orlando Sentinel’s editorial board compared Alden to “a biblical plague of locusts” and expressed hope that new investors “will prevail.”

“As a journalist you’re used to telling other people’s stories, so it feels strange to tell your own,” Russon said. “But there’s so much at stake I don’t think we have a choice.”

At the Baltimore Sun, the mood has shifted from joy to uncertainty. In February, Bainum agreed to buy the paper from Alden and turn it into a nonprofit. But that deal fell apart, and now Bainum and Wyss are trying to buy the whole company.

“I will still be incredibly nervous until I know there’s some conclusion,” said Liz Bowie, an education reporter for the Baltimore Sun who helped form the “Save Our Sun” campaign. “We did everything we could have done to try to save our newspaper.”

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