Tribune Shareholders Say Sale To Newspaper 'Destroyer' Finalized

CHICAGO — A hedge fund dubbed a "destroyer of newspapers" appeared to finalize a deal to purchase Tribune Publishing, owner of some of the nation's largest newspapers including the Chicago Tribune.

Shareholders on Friday approved the $633 million sale to Alden Global Capital, a New York-based hedge fund known for slashing newsroom staffing.

The Associate Press reported the finality of the deal is being questioned by the union representing Tribune journalists, which for months had unsuccessfully advocated for someone to outbid Alden.

Jon Schleuss, president of NewsGuild, told the AP that the journalists union is "digging into" whether the decision Patrick Soon-Shiong, the owner of the Los Angeles Times and Tribune’s No. 2 shareholder, to abstain from voting might block the deal.

The union cited the Tribune's proxy statement of April 20, which states that approval of the deal required the votes of at least two-thirds of shares not owned by Alden, and that an “abstain” vote counted the same as an “against” vote. Soon-Shiong, in a statement issued through a representative, said he “abstained from voting” and that he viewed Tribune as a “passive investment.”

The Tribune reported that Shoo-Shiong's proxy ballots were submitted without the “abstain” box being checked, and those votes were tallied as a “yes” vote.

On Twitter, Chicago Tribune Guild President Gregory Pratt accused Soon Shiong of "betraying journalism with his cowardly abstention."

If the deal does go through, Alden will become the owner of America's second-largest newspaper chain behind Gannett. Alden has gained a reputation for slashing newsroom budgets and laying off reporters and editors. For years, it has been known as the "destroyer of newspapers," and earlier this month, Vanity Fair called Alden the "hedge fund vampire that bleeds newspapers dry."

The Tribune Publishing deal would give Alden control of the Chicago Tribune, Baltimore Sun, Hartford Courant, Virginian-Pilot, Orlando Sentinel, South Florida Sun Sentinel, New York Daily News, Capital Gazette, The Morning Call in Allentown, Pennsylvania, and the Daily Press in Newport News, Virginia.

“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.” said Heath Freeman, president of Alden, in a statement.