Over the summer, Alden Global Capital acquired 100 percent of the Yardley-based Journal Register Co. newspaper chain when it bought the shares owned by fellow hedge fund investors.

Now Alden Global may be looking to reduce or sell its stake in the publisher of The Inquirer and Philadelphia Daily News, according to a report in the New York Post over the weekend.

Word of the possible sale by the New York hedge fund that reportedly controls 30 percent of Philadelphia Media Network Inc. fanned speculation among employees and readers that the newspapers and Philly.com website might be headed to their third ownership change since 2006.

Gregory J. Osberg, publisher and chief executive officer of Philadelphia Media Network, said in a statement to employees Monday afternoon that Alden Global, as a minority shareholder, had the right to increase or decrease its ownership stake at any time.

"This type of activity has been taking place since PMN was created in October 2010," Osberg said in the statement.

However, management declined to disclose specifics, such as how many of the original 32 investors remained, citing its status as a private company.

In response to a question about whether the entire company was for sale again, PMN spokesman Mark Block replied in an e-mail: "Shares of investment in Philadelphia Media Network are always for sale at the discretion of our owners, since the ownership is comprised of hedge funds and investment banks that make their own purchase and sale decisions."

An Alden Global spokesman did not respond to a request for comment.

Alden Global founder Randy Smith is considered a legend in the alternative investment field of distressed debt, which involves buying up debt securities of financially troubled companies for pennies on the dollar.

Besides owning Journal Register outright, Alden Global has become a significant investor in the media business, especially the newspaper industry. It also holds interests in Denver's MediaNews Group Inc., Gannett Co. Inc. of McLean, Va., and the Tribune Co. in Chicago.

According to an analysis by former newspaper executive Martin Langeveld posted on Harvard's Nieman Journalism Lab website in July, Alden Global may have invested as much as $750 million of its $3 billion in total assets in newspaper and broadcast media properties.

That doesn't mean distressed debt is a sure-fire way to turn a profit. In September, Reuters reported that Alden Global's Distressed Master Fund has fallen 13 percent in August, a down month for most global markets. The wire service, citing an investor letter from Alden Global that it had obtained, also said its Value Recovery Fund had lost 13.9 percent that same month.

In general, hedge fund performance was dismal in 2011. According to Hedge Fund Research Inc. in Chicago, a weighted composite index of all hedge funds declined 5.02 percent, net of fees, last year. In contrast, a broad measure of the U.S. stock market, the Standard & Poor's 500 Index, rose 2.09 percent, including dividends.

Contact Mike Armstrong at 215-854-2980, marmstrong@phillynews.com, or @PhillyInc on Twitter. Read his blog, "PhillyInc," at www.phillyinc.biz.