Local newspaper publisher Lee Enterprises is trying to fight off a hostile takeover attempt by urging its shareholders to vote for its three Board of Director members who are up for re-election on March 10.
In a letter to shareholders Monday, Lee calls this year’s annual meeting “particularly important” because of the recent hostile takeover bid by Alden Global Capital.
Alden is a hedge fund based in New York City and the owner of numerous newspapers across the country. It has been criticized by media groups for drastically downsizing the newspapers it owns.
Lee shareholders are invited to attend Lee’s annual meeting at Davenport headquarters at 4620 E. 53rd St. The meeting begins at 9 a.m. in Room 120.
In its letter to shareholders, Lee refers to Alden as a “vulture hedge fund.”
“We believe Alden remains set on buying Lee at a deeply discounted price and taking Lee’s upside away from you and the rest of the shareholders. To advance its inadequate, hostile bid, Alden attempted to nominate three hand-selected candidates to replace the members of the Board’s Executive Committee, which includes our Chairman, our CEO and our Lead Independent Director,” according to Lee’s letter.
In addition, Lee officials urge shareholders to vote for the three directors up for re-election: Chairman Mary Junck, President and CEO Kevin Mowbray and Lee Independent Director Herbert Moloney.
“We need your support to resist Alden’s efforts to replace Lee’s Board leaders with Alden’s favored candidates. We believe Alden is targeting our directors as the next step in their campaign to pressure the company into an unfair transaction that would secure Lee’s upside for Alden, at your expense,” the letter adds.
Lee also told shareholder that the company is making “great progress” in transforming from a traditional newspaper publisher into a digital-first business.
Alden did not respond for comment Monday to the Quad Cities Regional Business Journal.
On Nov. 22, Alden made an unsolicited bid to take control of Lee for $24 per share in cash.
The newspaper chain later announced that it may launch a “poison pill” plan that has the goal of making it more difficult and more costly for Alden to get controlling stake of the company. The plan would allow its other shareholders to buy shares at a 50% discount or possibly get free shares for every share they already own. The plan would take effect if Alden gets control of at least 10% of Lee’s stock.
Lee stock was listed at $33.75 a share by late morning Monday.
Lee Enterprises owns 77 daily newspapers across the nation, including the Quad-City Times, Dispatch/Argus and Muscatine Journal in the Quad Cities region.