Lord Rothermere’s Daily Mail and General Trust held talks with Qatari supporters to support a joint bid for Telegraph Media Group. This is the latest example of bidders scouring oil-rich Gulf countries for financial backing for the UK’s national newspaper.
Two people familiar with this situation say that DMGT, the owner of the Daily Mail and Metro papers, is currently in talks about additional equity to fund a bid to buy the rival media group, which could cost over £500mn.
In June, Lloyds Banking Group , which owes more than £1bn , took control of Telegraph Media Group away from the Barclays to try and recover as much as money through a sales. Media executives and rival groups held discussions with Gulf investors about funding the acquisition of right-leaning Broadsheet.
Sean Walsh, DMGT’s spokesperson, stated: “In the last few years, we have been approached by a number Middle Eastern investors interested in participating in a bid to buy the Daily Telegraph.
He said: “Today, we don’t have any formal relationships with investors. However, if that changed, it would be only if we had the majority of the economic and equity risks, as well as the control necessary to invest in the company and protect its independence.
A person familiar with this matter said that Abu Dhabi’s RedBird IMI also had discussions about supporting a bid to buy the Telegraph. RedBird refused to comment.
Another person said that the Barclay family also sought out UAE-based investors who would support their bid to purchase back the Telegraph.
Two people who are familiar with these offers said that the family has made repeated offers to Lloyds to purchase the newspaper they had seized. The latest offer was for more than £600mn. The rival bidders are alarmed. The Barclays declined to comment about their latest offer.
It was reported that the lender had also started to talk to the Barclays about their future for the Very Group. This is the multi-billion pound financial services group and retail company whose holding companies are linked to the Telegraph’s debt.
Sir William Lewis is getting ready to form a consortium and make an offer. This could include money coming from the Middle East.
Goldman Sachs, the auctioneer, is expected to begin in the coming weeks. The auction could bring in more than £500mn.
Saudi investors already own a portion of the UK media industry. The Evening Standard in London and the Independent newspaper are owned by a Saudi investor.
The potential bidders of the Telegraph think the UK government will be happy with more media ownership coming from the Gulf. They cite the ownership of British soccer clubs and the upcoming meeting between Rishi Sunak, the Saudi Crown Prince, and Mohammed bin Salman.
Analysts say that any substantial offer by the group will probably require additional equity from other investors.
Due to its strong advertising presence in print media, DMGT may face regulatory issues. A person suggested that one option would be for DMGT to sell at least some of its smaller titles.
The combination of the Telegraph and Mail, two powerful right-leaning newspapers in the UK, may raise concerns about ownership.
Those familiar with the auction process say that dozens of parties have expressed interest in the sale ahead of the formal auction, which is expected to begin in the coming weeks.
National World, the local newspaper publisher, founded by David Montgomery, a media executive, confirmed it was looking at an offer to buy the newspaper.
According to sources close to the group, Rupert Murdoch’s News UK registered an interest. Sir Paul Marshall, a millionaire hedge fund investor who supports Brexit, has also been linked to a bid. Daniel Kretinsky is also considering an offer. He’s a billionaire Czech investor.
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