Lee Enterprises Inc. said its board has approved a shareholder rights plan, also known as a poison pill, that would prevent hedge fund Alden Global Capital LLC from acquiring more than 10% of the company as it considers Alden’s hostile bid for the newspaper publisher.
The plan will be in effect for a year, the company said Wednesday. Lee Enterprises /zigman2/quotes/205158900/composite LEE +0.40% Chairman Mary Junck said the plan would give the company’s board and its shareholders time to assess the acquisition proposal without undue pressure.
“Consistent with its fiduciary duties, Lee’s Board has taken this action to ensure our shareholders receive fair treatment, full transparency and protection in connection with Alden’s unsolicited proposal to acquire Lee,” Junck said in a statement.
Alden Global on Monday offered to acquire Lee in a deal that would value the Davenport, Iowa-based publisher at around $141 million. Alden’s pursuit of Lee is the hedge fund’s third effort to acquire a large local-news publisher in roughly two years, following a failed bid to acquire USA Today owner Gannett Co. /zigman2/quotes/202050177/composite GCI +1.46% in 2019 and a successful move to purchase New York Daily News and Chicago Tribune owner Tribune Publishing earlier this year.
Alden Global has been criticized by employees of its media properties and industry experts for aggressive cost-cutting, while its executives say the reductions help preserve newspapers.
An expanded version of this report appears on WSJ.com.
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