It can be revealed that The Telegraph could be in financial trouble if the Barclay Family regained control after the failed takeover supported by the United Arab Emirates.
The family’s possible comeback could restrict the company’s access to finance due to suspicious transactions that were discovered when the company was in receivership last year by Lloyds Banking Group.
Sources said that Lloyds would demand immediate repayment of a loan of £60m to Press Acquisitions Limited (parent company of The Telegraph magazine and The Spectator).
It is not related to the £1.2bn Barclay family overdue debt which prompted the bank’s decision to send receivers. It has never defaulted.
The National Crime Agency (NCA) is a clearinghouse that can pass on intelligence to other authorities, including the Serious Fraud Office or HMRC. Lloyds may have been one of the parties involved with The Telegraph’s receivership.
According to multiple sources, the SARs that were previously reported were also made by independent directors, who still oversee the company. They were also made by legal and restructuring advisors.
Concerns were raised by large sums of money being transferred between The Telegraph, and companies controlled by Barclay. In response, the independent directors called on the law firm BCL as well as the PwC audit to conduct an investigation.
Lloyds, knowing about the suspicious transactions, could withdraw funding if Barclays regained control under their own integrity and regulatory policies.
The family has experienced personal and financial turmoil over the past few years. They regained their beneficial ownership in The Telegraph after paying off their £1.2bn Lloyds debt with new loans, mostly from the UAE. RedBird IMI – a US investment fund backed by Gulf powers – acquired the option to purchase The Telegraph and The Spectator as part of this complex deal.
The plan was derailed last month when cross-party action in the House of Lords prompted the Government to
Since they gained ownership, the Barclays have been prevented from controlling The Telegraph due to measures implemented by Culture Secretary Lucy Frazer in order to allow regulatory oversight of RedBird IMI’s plans. She retained the independent directors who were appointed by Lloyds in the receivership.
RedBird IMI prepares to sell the option of owning The Telegraph. However, this process is fraught by complications, including the uncertainty of the roles played by the Barclay Family, the Government, and independent directors. RedBird IMI will remove the restrictions that prevent Barclay from exercising control as soon as it gives formal notice that it doesn’t intend to pursue an acquisition.
The Barclays declined to comment about the possibility of Lloyds gaining control, or on any possible response. PwC audited the accounts and approved them, according to a previous spokesman.
Lloyds has declined to comment about its loan to Press Acquisitions Limited, or SARs related to The Telegraph.
The Department for Culture, Media and Sport refused to comment.