It looks like hedge fund Alden Global Capital may have competition for the purchase of Tribune Publishing and its network of newspapers with several interested parties making bids of their own – businessman and philanthropist Stewart Bainum Jr. and Swiss billionaire and philanthropist Hansjörg Wyss. Bainum is the chairman of Choice Hotels International; Wyss was the former chief executive of Synthes, a medical device manufacturer.
In February, Alden announced it would acquire Tribune Publishing for $630 million in an all-cash deal which included he Chicago Tribune, The (New York) Daily News, Orlando Sentinel, Sun-Sentinel, (Virginia) Daily Press, The Virginian-Pilot, The Morning Call (Lehigh Valley, Pennsylvania) and the Hartford Courant.
Though a part of Tribune Publishing, The Baltimore Sun was not included in the deal. Instead, Alden entered into a non-binding agreement to sell the newspaper to the Sunlight for All Institute, a nonprofit formed by Bainum. As part of the acquisition, the Sunlight for All Institute would also buy the Capital Gazette papers in Annapolis, The Carroll County Times and other Baltimore-area weeklies, magazines and digital properties, according to The Baltimore Sun.
According to Bloomberg, Alden and Bainum have disagreed how they’d work together until the newspapers were fully released from Tribune Publishing’s grasp. Bainum is reportedly skeptical of Alden’s intentions to sell and is making a bid for the entire company. Bloomberg said that Bainum asked to be released from a nondisclosure agreement, so he could discuss the matter with interested parties like other philanthropists who want to support journalism. Bainum is willing to contribute $100 million and seek financing and other partners to present his own bid.
Fast forward two weeks and Swiss billionaire Hansjörg Wyss wants to join Bainum in a bid against Alden. Wyss, who lives in Wyoming, would also put up $100 million. Tribune Publishing’s board has already approved Alden’s February offer, but they have also given Bainum their approval to pursue additional financing for a higher bid.
In an article in The New York Times, Wyss said he believes in a “robust press.”
“I have an opportunity to do 500 times more than what I’m doing now,” Wyss said. “I don’t want to see another newspaper that has a chance to increase the amount of truth being told to the American people going down the drain.”
The New York Times reports that Bainum has made a bid for all of Tribune Publishing at $18.50 a share, valuing the company at $650 million, $20 million more than Alden’s bid. Alden offered $17.25 per share in cash. Regardless of which offer is accepted, there are other hurdles to tackle, including getting the approval of other key shareholders. Dr. Patrick Soon-Shiong, owner of the Los Angeles Times, is the second largest shareholder of Tribune Publishing with a 24% stake. Soon-Shiong owns enough stock to block the deal on his own. After that, there are regulatory hurdles.
Insider Take
What appeared to be a slam dunk is anything but. The journalism community is up in arms over Alden’s possible purchase. The hedge fund is known for its acquisition of newspaper groups, slashing costs and cutting staff. The purchase of Tribune Publishing by Alden could mean the loss of quality local news coverage in the markets Tribune Publishing serves. A higher bid from well-intentioned buyers may be more palatable to Tribune Publishing and certainly to its staff and the communities who depend on their newspapers. We’ll continue to follow this story and keep you posted on the latest news.
