By Julie Reynolds
Twenty-one prominent US Senators have sent a scathing letter to the founders of Alden Global Capital, decrying its “newspaper-killing business model” and vowing to “continue watching Alden closely.”
The letter was sent last week on the eve of the hedge fund’s failed attempted takeover of Gannett newspapers. Alden, owner of the Digital First Media newspaper chain (recently rebranded as MNG, or MediaNews Group), had named first six and then a pared-down three upstart candidates for Gannett’s board, but all were soundly rebuffed at Gannett’s shareholders’ meeting last week.
Sen. Sherrod Brown (D-OH) was among those voicing opposition to Alden’s “well-known” track record, describing it as “devastating for the communities whose newspapers are gutted.”
“The senators noted that this is not the first time Alden’s predatory tactics have threatened the free press and it isn’t likely to be the last. They vowed to continue watching Alden closely,” Brown said in a statement after the vote that defeated Alden’s takeover slate.
Also signing were Democratic senators Chuck Schumer, Elizabeth Warren, Tammy Baldwin, Bob Casey, Tom Udall, Patty Murray, Angus King, Joe Manchin, Tim Kaine, Brian Schatz, Dianne Feinstein, Martin Heinrich, Doug Jones, Ed Markey, Catherine Cortez Masto, Ben Cardin, Jacky Rosen, Chris Van Hollen, Cory Booker and Robert Menendez.
“Alden Global Capital’s track record of media purchases is well-known and devastating for the communities whose newspapers are gutted in the process,” the senators wrote to Alden’s president Heath Freeman and co-founder Randall Smith.
“Your predatory approach to these purchases will further undermine newspapers’ ability to fulfill their mission of providing news and information to the public,” the letter stated.
The letter also expressed concern over the hedge fund’s apparent self-dealing when it invested nearly $250 million of workers’ pension monies into Alden-controlled investment funds, as DFMworkers reported in 2017. According to the Washington Post, the Department of Labor recently began investigating those transactions.
Sen. Chuck Schumer also issued a statement after’s Alden’s slate was defeated.
“The Gannett shareholder’s rejection of Alden’s takeover is a temporary sigh of relief for newsroom staff, employee’s pensions and local communities across the country whose very existence has been under threat by Alden’s avaricious ways,” Schumer stated. “Local newspapers, including the six Gannett papers throughout upstate New York, are the glue that keeps communities across the country informed and stitched together. I will continue to fight to ensure that firms like Alden aren’t able to buy and sell companies without regard for how they may affect our New York communities and how they may be hindering the First Amendment and the freedom and viability of the press.”
Schumer had previously written to Freeman on Feb. 21, expressing concerns about self-dealing, the hinky pension investments, and that fact that Alden “has not made public details regarding any commitments it is willing to make to maintain newsroom staffing.” He also sent letters to the Department of Justice and the Pension Benefit Guaranty Corp. asking about potential antitrust and other conflicts if Alden were to take over Gannett.
The House of Representatives is also getting involved. A group of US representatives is looking into the evolving news business landscape its impact on local news. California Rep. Mark DeSaulnier (D-Concord) has formed a “Saving Local News” congressional working group to raise awareness of and “protect local news.”
The senators’ full letter to Alden’s Freeman and Smith can be read here.