Alden Global Capital has sued Lee Enterprises, which owns the majority of daily newspapers in Montana, according to a story Wednesday from the Poynter Institute.
Last month, Alden, the hedge fund known for cutting newsrooms, made a bid to buy Lee for $24 a share. Lee owns 77 dailies including in the mountain states and midwest.
Alden alleged Lee rejected the $141 million buyout bid too quickly and also acted hastily in adopting a “poison pill” to prevent Alden affiliates from gaining stock above 10% in the next year, said the story from Poynter. Poynter is a nonprofit focused on media and journalism.
The Poynter story said one section of the lawsuit has “a noteworthy aside.”
“While Alden’s proposal represented a significant (30%) premium for stockholders,” said the suit, cited by Poynter, ”it was designed to be a preliminary proposal, with the goal of opening a dialogue to engage constructively with the Company.”
The story also notes Alden asks its three candidates for the Lee Board to be reinstated.
Poynter offered this analysis of the business approach: “Alden’s strategy seems to have shifted back to gaining influence and seats on the board to make a case against Lee management. It pursued that gradual approach in pushing cost-cutting moves at Tribune Publishing over a period of two years before prevailing in a contested effort to buy the company this summer.”