Newspaper publishing company Lee Enterprises – whose papers include the Chadron Record, Scottsbluff Star-Herald, Rapid City Journal, Omaha World Herald, and Lincoln Journal Star – is asking its shareholders to help it fight off a hostile takeover offer
Alden Global Capital, described as a “vulture hedge fund,” has offered $24 a share for Lee, who sent a letter to shareholders Monday asking them to support its board nominees in the dispute with Alden.
Iowa-based Lee has already rejected Alden’s offer, saying the $141 million dollar bid grossly undervalues the company, but the two sides are locked in a court battle over whether Alden will be able to nominate candidates for the Lee board.
The board rejected Alden’s nominees, saying they didn’t qualify and because the hedge fund failed to submit the names before the nomination deadline. Alden is challenging that ruling.
Alden currently owns over 6% of Lee stock and the board has passed some poison pill measures that will take effect if the hedge fund’s holdings reach 10%. Those include issuing more stock to make the takeover attempt more expensive.