The Hard Truth at Newspapers Across America: Hedge Funds Are in Charge

A group of journalists protesting outside the offices of a New York City hedge fund recently shined a light on a little-known fact about the state of the local American newspaper: Behind the scenes, financial firms often hold all the cards. Investors like Alden Global Capital LLC and Fortress Investment Group LLC have acquired ownership stakes in newspapers that have struggled to adapt in an online world, from the Denver Post to the Providence Journal. Funds have brought their cost-cutting know-how to help restructure several newspaper chains in heavy debt after the 2008 financial crisis. But the evolving ownership picture has sparked fresh questions over whether investment firms can really help save local newspapers by making them profitable again -- or if they’ll starve them to the point that they collapse instead. "They’re not reinvesting in the business,” Ken Doctor, a longtime newspaper analyst and president of the website Newsonomics, said about Alden Global. “It’s dying and they are going to make every dollar they can on the way down.”