Hedge fund buys local publisher Journal Register

The Journal Register Co., which publishes a number of area newspapers, has been sold to a hedge fund with offices in New York, Dallas, Mumbai, and Dubai.

Terms of the deal were not disclosed. The purchaser, Alden Global Capital, was an investor in the Journal Register Co., based in Yardley, when it emerged from bankruptcy in July 2009. Alden Global Capital also owns a "significant stake" in Philadelphia Media Network Inc., according to Greg Osberg, publisher and chief executive officer of The Inquirer, the Philadelphia Daily News, and Philly.com.

The deal is good news, said John Paton, chief executive of the Journal Register Co., which publishes the Delaware County Daily Times, the Norristown Times Herald, the Trentonian, and other local papers.

"I think it means that we are going to grow," he said.

"We've been on a pretty good ride," Paton said, describing the company's focus on digital publishing. "We've gone from being a crappy company to being pretty innovative."

The strategy moved the company from bankruptcy into one with profits of $41 million before taxes and interest in its last fiscal year, the company said.

The transaction allows all lenders to be fully paid and to receive equity consideration, the company said in a statement.

The company says it reaches 19.5 million people a month through 350 multi-platform products in 10 states.

Employment, now at 3,000, has declined 10 percent in two years, Paton said.

Randall Smith, a specialist in buying distressed companies, especially newspaper companies, runs Alden Global Capital. His brother, Russ, had owned papers in Washington and Baltimore.

Paton and Osberg said the two companies had been cooperating. They coproduce Savings Spree! to distribute advertising inserts.

"In view of our common ownership, we hope to further partner with JRC on additional opportunities," Osberg said.