Last week Post-shipment Parent company Lee Enterprises has rejected an offer from New York-based hedge fund Alden Global Capital to buy Lee for $ 24 a share. Now, Alden is suing Lee and claims that Lee ignored their own rules by rejecting Alden’s offer.
Alden’s announcement in November that they were trying to buy Lee raised alarm bells among many media watchers and academics who study journalism. Alden has a habit of emptying the newspapers they own.
Jeff Gordon, sports reporter for Post-Dispatch and chairman of the United Media Guild, says he is “not surprised” that Alden persists.
“Basically what Alden is saying is you didn’t even engage with us,” Gordon said. “You criticized this bid as insufficient, but we didn’t have the opportunity to bid higher. Shareholders don’t know how far we were prepared to go because you shot us down.”
According to Gordon, part of Alden’s strategy may be to exhaust Lee by keeping the legal pressure on. “If Alden really wants to own Lee, they’re going to keep hammering,” Gordon said.
One potential way for Lee to avoid Alden’s takeover would be to merge with another company, becoming bigger and therefore more difficult for Alden to control. In 2019, Gannett, the parent company of USA today and many other newspapers, merged with another media company after successfully fending off a hostile takeover of Alden.
A meeting of Lee’s shareholders is scheduled for February 2022. Alden previously appointed three people who would be in favor of the Alden takeover to be elected to Lee’s board at that meeting.
Lee has yet to announce whether the February reunion will be in person or virtual.
If the meeting goes in person, “it could get interesting,” Gordon said.
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