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Journalists Battle Against Hedge Fund Giant Alden Global

LULU GARCIA-NAVARRO, HOST:

For more than a year, Alden Global Capital's attempt to take over the Tribune Publishing Company, which owns papers like the Chicago Tribune, has gained momentum. But as NPR's David Folkenflik reports, that bid is now in doubt.

DAVID FOLKENFLIK, BYLINE: Meet the David in this battle against the hedge fund Goliath. Her name is Liz Bowie.

LIZ BOWIE: The group of reporters that I'm working with, we've nicknamed ourself Project Mayhem.

FOLKENFLIK: Bowie has been a reporter at the Baltimore Sun for more than three decades, and she has galvanized a small group of journalists at papers across the chain.

BOWIE: We have a Slack channel, and we regularly talk on that Slack channel. And then we have a weekly Zoom meeting in which we sort of plot strategy and talk about where each city is in terms of lining up buyers.

FOLKENFLIK: Jennifer Sheehan covers food and entertainment for the Allentown Morning Call in the Lehigh Valley, an hour north of Philadelphia. The paper's owned by Tribune Publishing. She's part of Project Mayhem, too.

JENNIFER SHEEHAN: You know, Liz Bowie and I, we probably talk at least twice a week. I mean, I talk to her more than I talk to my in-laws anymore. We're just always updating each other on the latest, even if it's like, boy, we're really worried about X, you know? Like, this latest filing came out. Like, what does this mean?

FOLKENFLIK: Why all the effort?

SHEEHAN: If you look at who has owned newspapers and who has destroyed newspapers, Alden Global Capital is it.

FOLKENFLIK: Alden has something of a record and reputation.

SHEEHAN: Alden is the worst.

FOLKENFLIK: Aldan declined to comment for this story. It has said it wants to build a sustainable path for newspapers. Alden is better known for slashing newsrooms in Denver, the Bay Area and elsewhere, leaving far fewer people to cover city hall or schools or other beats, if any at all. A study by a union representing many of its journalists found Alden shifted more than $100 million away from its newspapers to cover big losses in unrelated investments, like a drugstore chain.

Back in February, NPR obtained audio of Chicago Tribune editor-in-chief Colin McMahon speaking to his newsroom. McMahon said Alden would demand sky-high profit margins.

(SOUNDBITE OF ARCHIVED RECORDING)

COLIN MCMAHON: Alden's opinion is it should be a hub (ph) above 20. So Tribune has been operating in that - you know, the 10, 12, 13% range.

FOLKENFLIK: That is, Tribune's papers are already profitable. Alden wants to nearly double those profits at newsrooms already cut to the bone. Again, Liz Bowie.

BOWIE: I felt that if the numbers of reporters and editors were significantly reduced, that would change everything. And so I didn't feel I wanted to be part of a newsroom that couldn't do good work anymore.

FOLKENFLIK: A year ago, Bowie and colleagues in Baltimore started the Save Our Sun initiative to drum up support for local ownership. Privately, she conferred with foundation officials and civic leaders. A few months ago, she thought she'd hit the jackpot. Several of those leaders advised the Maryland hotel magnate and philanthropist Stewart Bainum. He struck a deal to buy the Sun from Alden and turn it into a not-for-profit once Alden had bought Tribune Publishing. When Alden slow-waked that deal, Bainum made a bid for the whole company.

Versions of Save Our Sun surfaced across the chain to win community support and to attract possible buyers for each paper. A surprising number emerged. One Florida investor shot a note to Gabrielle Russon, a reporter at the Orlando Sentinel, involved in efforts there.

GABRIELLE RUSSON: When I saw that email, I had to reread it a couple of times just to make sure. I felt like I was imagining something. You know, $100 million and someone so supportive of the papers - I was worried it was a joke.

FOLKENFLIK: Newsroom unions played a big role. They enabled journalists to speak without fear of punishment and kindled the spark that started in Baltimore. Again, Liz Bowie.

BOWIE: A year ago, we thought, why don't we just start this crazy, crazy idea off to see if we can find a buyer for our newspaper? And now we're sitting in a place where the entire company might be sold in the next couple of weeks.

FOLKENFLIK: But nothing - nothing in this story run smooth. A billionaire philanthropist joined forces with Bainum a few weeks ago to help outbid Alden. On Friday, that philanthropist withdrew. He concluded his dreams of turning the Chicago Tribune into a national paper would cost too much - another stage in the ongoing roller coaster ride for the reporters of Project Mayhem. David Folkenflik, NPR News.

(SOUNDBITE OF VULFPECK'S "SMILE MEDIATION") Transcript provided by NPR, Copyright NPR.