Hoffmann has an eye on the Post-Dispatch after big spend in Augusta

Earlier this week, David Hoffmann, chairman of the Hoffmann Family of Companies, floated the idea of the multi-billion dollar firm buying the St. Louis Post-Dispatch.

Hoffmann currently has a 5 percent stake in Lee Enterprises, the Post’s parent company, and wants to increase those holdings. Last month Hoffmann bought three small Lee-owned publications, The Napa Valley Register, St. Helena Star, and Inside Napa Valley magazine. The idea of buying the Post itself, floated Tuesday in the pages of the St. Louis Business Journal, would be a big change for the city’s paper of record—though what that change would look like is unclear. 

“It just depends on, ultimately, the motivation,” says Jeff Gordon, a sportswriter for the paper as well as the president of The United Media Guild, which represents journalists and sales associates.

Hoffmann, a private company valued at around $3 billion, owns everything from manufacturing businesses throughout the region to a ferry business in Michigan and a Blues-affiliated minor league hockey team in Florida. The Business Journal recently reported that the company plans to buy two office towers in Clayton, in addition to the two Clayton office towers they already own, one of which, the Hoffmann Building on Maryland, houses their commercial real estate headquarters. 

While the company has steadily been in the news for those and other acquisitions, Hoffmann has gotten the most local press—much of it not particularly good—for the bold plan they announced in 2021 to spend $125 million turning a swath of wine country in Augusta into “Napa Valley in Missouri,” replete with a golf course, luxury hotel, and a 96-foot yacht ferrying people up and down the Missouri River. 

However, in the past year, the company has had to sell off some of the property they purchased. The golf course hit bedrock. The luxury hotel has not materialized. (The Yacht, however, is afloat.) A Wright County grape grower filed a lawsuit saying that a winery owned by Hoffmann misled him, leaving him with wasted product. In Clayton, the company defaulted on a $31 million loan for one of their Clayton buildings. All of this was reported in the Post-Dispatch. 

It begs the question of what Hoffmann owning the Post-Dispatch, the state’s biggest paper, would portend for its coverage of Hoffmann.

“You have to wonder, will we ever fall into the hands of an agenda-driven owner?” says Gordon. “I don’t know. I mean, we hope not, and we don’t want to prejudge anybody that would come in.”

Gordon says that any potential new owner needs to understand that journalism’s role in society is to help make democracy work, to hold people accountable. “If somebody’s committed to that, we’re all for it, right? But it just depends.”

Hoffmann told the Business Journal that the newspaper business has been “beaten up pretty bad” but that it’s ultimately not going anywhere. He added that he sees growth potential in the digital ad space. (He also added that he didn’t know if the Post-Dispatch was for sale.)

The Post has hit more than its fair share of headwinds in recent months. The end of August brought news that six employees face layoffs. Ultimately, the paper lost a reporter and digital editor to those layoffs, but others were spared by a combination of older employees taking buyouts and the union getting one of their members off the chopping block. Then, earlier this week, executive editor Alan Achkar announced that for the first time in the paper’s nearly 150-year history, it would not be printed locally. Printing would be outsourced to Columbia, and the paper’s press in Maryland Heights would close, shedding 72 jobs by January. 

Three years ago, around the same time Hoffmann was announcing their Napa of Missouri plans, the biggest threat to the Post-Dispatch was that Alden Global Capital, a New York City-based investment firm known for buying and then gutting newspapers, had designs to take over Lee. 

“Lee decided that it was going to trim all the fat it possibly could, in its thinking, to become unattractive to the hedge funds,” says Gordon. “They succeeded in fending off the hedge funds. But they’ve done that by acting like a hedge fund.”

Three years ago, not long after Hoffmann announced their Augusta bid, writer Kathy Gilsinan reported about the mixed reaction their plans were getting in Augusta itself. Gilsinan, who is a contributing writer for Politico Magazine, says that given the industry-wide headwinds journalism faces, there’s understandably a temptation to think that “rich people will save journalism.”

“Rich people are just like everyone else, some are very civic minded. Some are not,” she says. “Money by definition is never free.”

At the same time, she says that for a Hoffmann-owned newspaper, the biggest concern might not be any sort of conflict of interest. 

“I don’t know if the analogy would hold up, but the Augusta experience leads to questions of whether or not their ambition will match their abilities.”

Correction: A previous version of this story misidentified Alden Global Capital as a hedge fund. It is an investment firm. We regret the error.