Board members of Lee Enterprises, the newspaper chain that owns many of Montana’s largest dailies, has rejected an unsolicited offer on the company from Alden Global Capital, a hedge fund that’s developed a reputation for drastically cutting costs on its way to becoming the country’s second largest newspaper owner.
In a statement to investors, Lee, which owns the Missoulian, (Butte) Montana Standard, Billings Gazette, Ravalli Republic and Helena Independent Record, said Alden’s $24-per-share all-cash offer “grossly undervalues Lee and fails to recognize the strength of our business today.”
Lee operates more than 350 daily and weekly publications in 26 states and stands as one of the few remaining independent newspaper chains — the finance sector, as with Alden, has begun to take an increasingly large chunk out of the media industry, often prioritizing whatever profit is possible in a struggling business environment over quality of coverage.
That said, Lee doesn’t have a sterling reputation itself, as its purchase of several papers from Berkshire Hathaway also led to dramatic cuts.
The company’s Montana newsrooms have faced challenges with layoffs, buy-outs and resignations. Nonetheless, unions in the Lee network, including the Montana News Guild, which represents staff at the Billings Gazette, have been vocally opposed to a takeover by Alden.
Alden currently owns 6 percent of Lee shares, a purchase that foreshadowed the takeover bid. Lee has already adopted a shareholder rights plan that would prevent Alden from acquiring more than 10 percent of the company over a year period.
Alden, however, has proven willing to forge ahead regardless, mounting an ultimately unsuccessful hostile takeover of Gannett in 2019. Earlier this year, the fund successfully acquired Tribune Publishing despite vociferous opposition from the historic publishing company’s reporters.