Manchester City owner and UAE Deputy Prime Minister Sheikh Mansour bin Zayed Al Nahyan could be about to become the new owner of the struggling Telegraph and Spectator titles.
The Abu Dhabi-backed investment fund RedBird IMI said on Monday it had “reached an agreement to provide a package of loans to the Barclay family allowing them to pay off their debt to Lloyds Bank in full and bring the Telegraph and Spectator out of receivership.”
The titles were bought by brothers Frederick and (the now-late) David Barclay in 2004, however they were put on the market in June after Lloyds Banking Group seized control by appointing receivers over around £1.2bn of unpaid debts.
RedBird IMI is a joint venture between US fund RedBird Capital Partners and Sheikh Mansour’s International Media Investments (IMI).
It described itself in its December 2022 launch announcement as “a joint venture investment vehicle focused on acquiring and investing in large scale media, entertainment and sports content properties on a global basis.”
It launched with an initial committed capital of $1bn, which the New York Times reported in June was split 25/75 between RedBird and IMI.
The Telegraph deal, RedBird IMI said, will provide a £600m loan, secured against the Telegraph and Spectator, and “a loan of a similar amount secured against other Barclay family businesses and commercial interests.”
RedBird IMI would then have an option to convert the loan secured against the Telegraph and Spectator into equity.
It said it “intends to exercise this option at an early opportunity.”
RedBird’s spokesman added: “Any transfer of ownership will of course be subject to regulatory review and we will continue to cooperate fully with the government and the regulator.”
The regulatory nod is presumably in response to a Bloomberg report that claimed a group of Tory MPs have written to deputy prime minister Oliver Dowden questioning the wisdom of allowing a fund closely linked to an overseas government to buy a UK national newspaper.
“Material influence over a quality national newspaper being passed to a foreign ruler at any time should raise concerns, but given the current geopolitical context, such a deal must be investigated,” Bloomberg quoted from the letter.
Possibly seeking to further calm Tory nerves, RedBird IMI’s spokesman continued: “Following transfer of ownership, RedBird Capital alone will take over management and operational responsibility for the titles under the leadership of RedBird IMI chief executive Jeff Zucker. International Media Investments will be a passive investor only.
“RedBird IMI are entirely committed to maintaining the existing editorial team of the Telegraph and Spectator publications, and believe that editorial independence for these titles is essential to protecting their reputation and credibility.”
RedBird IMI chief Zucker is the former president of CNN. Parent RedBird Capital is perhaps best known for last year’s £1.2bn takeover of AC Milan. It also holds a majority stake in French football club Toulouse, as well as a minority, 11 per cent, stake in Liverpool FC.
International Media Investments is “a privately owned investment company focused on building a portfolio of quality media assets across the globe,” owned by Sheikh Mansour.
Its key properties include Abu Dhabi English-language daily The National, Sky News Arabia and CNN Business Arabic. The company also owns a minority stake in Brussels-based Euronews.
Although RedBird IMI’s statement suggests the takeover is a done deal subject to regulatory approval, the official deadline for first-round bids in the auction process for the Telegraph and Spectator, which opened in October, is not until November 28.
Other names linked with a potential bid include the Daily Mail & General Trust, News UK, Yorkshire Post publisher National World, Germany’s Axel Springer SE of Baader Meinhof Group fame, and a consortium led by Sir Paul Marshall, the multi-millionaire hedge fund boss and GB News joint owner.