Today, some of the largest newspaper groups in the country —such as Tribune, McClatchy and Media News Group — are owned, controlled by or in debt to hedge funds or private equity groups. In fact, hedge funds and other financial firms control half of the daily newspapers in the United States.
The hedge fund, which already owns a big stake in Tribune Publishing, could disclose an offer for the newspaper chain as soon as today, according to people familiar with the matter.
Hedge fund ownership of newspaper groups typically spells doom for the newsrooms. But Chatham Asset Management’s takeover of McClatchy — scheduled to be finalized on Tuesday — is actually inspiring some cautious optimism among its journalists. That’s because Chatham has agreed to allow all employees to keep their jobs while honoring existing union contracts under the hedge fund’s plan to pay $312 million for the newspaper conglomerate. It’s a stark contrast to hedge funds’ habit of job cutting when they take ownership of newspapers.
In keeping with a nationwide industry trend, a finance firm seems poised to take control of the publisher of The Miami Herald and The Sacramento Bee.
Heath Freeman is the hedge fund guy who says he wants to save local news. Somehow, no one’s buying it.