Newspaper publisher Lee Enterprises has rejected a takeover offer from the Alden Global Capital hedge fund, one of the largest newspaper owners in the country with a reputation for intense cost cuts and layoffs, but the fight over the company’s future is likely far from over.

Lee said last Thursday that its board had unanimously rejected Alden’s offer to buy the company for $24 per share or about $141 million because it isn’t in the best interests of shareholders. Lee also reported a $5.3 million fiscal fourth-quarter profit this year, rebounding from a $1.3 million loss a year ago, as its total number of digital-only subscribers grew 65% to 402,000.

“The Alden proposal grossly undervalues Lee and fails to recognize the strength of our business today, as the fastest-growing digital subscription platform in local media, and our compelling future prospects,” Lee Chairman Mary Junck said in a statement.

But Ken Doctor, a longtime media analyst who now runs a local online journalism startup called Lookout Santa Cruz in California, said Alden isn’t likely to abandon its bid to acquire Lee because it believes it can extract profits from the company with the model it has used elsewhere that calls for selling off the real estate the chain owns and drastically cutting costs.

“What Alden has done — and it’s now pretty proven community to community — it’s harvesting the last profits out of the newspaper business and it is doing that unapologetically,” Doctor said.

Alden said last month when it made its offer that it already owned more than 6% of Lee’s stock. Even if Lee succeeds at turning away Alden, it will likely face pressure to sell itself to someone else in the next couple of years or find a suitor willing to take it private.

In that regard, Lee might be able to get assistance from its biggest financier, Warren Buffett’s Berkshire Hathaway, which has held Lee’s $483 million in debt since Berkshire decided to sell its newspaper chain to Lee in 2020. At the time, Buffett praised Lee as the best steward for its papers. Buffett did not immediately respond to a request for comment.

The newspaper industry has been struggling with shrinking revenue as it transitions to digital publication, and the pandemic only intensified those stresses. Pew Research has estimated that nearly half of all newsroom jobs were eliminated between 2004 and 2018 as newspapers consolidated or closed. About one-fourth of the country’s newspapers have closed in the past 15 years, according to the University of North Carolina.

Lee has received support from its second-largest shareholder, Praetorian Capital, which holds 7.3% of Lee’s stock. Investment manager Harris Kupperman said in a letter to Lee’s board last Wednesday that he believes the company’s stock is worth at least $100 apiece — well above Alden’s opportunistic offer.

“The only reason that the shares trade where they do, is that investors have yet to realize that while the traditional print newspaper business slowly declines, the digital business has been growing rapidly, becoming an increasingly substantial percentage of the total business,” Kupperman wrote.

Lee owns the Omaha World-Herald and Lincoln Journal Star, as well as the St. Louis Post-Dispatch, the Buffalo News and dozens of other newspapers including most daily newspapers in Nebraska. (The Daily Record is independently owned and operated.)

Unions at those Lee papers have urged the company to fight off Alden’s advances because of concerns about what the hedge fund would do to their newsrooms.