The story of the Barclay brothers, who own the Daily Telegraph, and how they built an empire.

Aidan Barclay named his first superyacht the Enigma when he bought it from Oracle founder Larry Ellison. Aidan Barclay had just been named chairman of the Telegraph Media Group, in the summer 2004. It was difficult not to view the rechristening of his yacht as a sly nod to Britain’s most mysterious billionaires.

His father Sir David, and his uncle Sir Frederick should have been the two most well-known businessmen in Britain when they bought the Telegraph. Their empire included luxury hotels like the Ritz and one of the UK’s largest and most historic retailers. But their story also echoed the best traditions of rags to riches success in postwar London. Margaret Thatcher was helped to find a place to live after she left Downing Street by the company.

Their passion for privacy, and their willingness to hire phalanxes to enforce it made them the oddest and most unusual newspaper owners.

In the 1980s they stopped interviewing journalists. By 2004, however, when they achieved the amazing feat of merging the two largest home retail groups in Britain, Littlewoods & Great Universal Stores in only six months and purchasing the most popular broadsheet newspaper at the time, there was only one public photo of them. The mirror twins – who wore identical clothing for the majority of their lives, and could only tell apart by their hair parting – were shown receiving their Knighthoods in a historic double dubbing.

Aidan, eldest son, and heir apparent to the Telegraph, said to Bloomberg that he did not think his financial, business, or charitable affairs were of public concern, as he was not accountable to shareholders or members of the general public. We would rather you didn’t write about us.”

His father shared this view, having shunned fame since a very brief and early brush in the 1950s, when he married Zoe Newton, one of Britain’s most famous models. In the summer of 2019 he filed a lawsuit against a French playwright, who had staged a farce absurdist about two billionaire brothers. In the defence documents, Sir David was accused of an “exaggerated taste for secrecy”.

They bought Brecqhou Island near Sark in 1993 and built the largest private residence ever built, valued at £80 million today. The hideaway was built to attract more media attention on the brothers. John Sweeney was the journalist who tried to get Brecqhou. He then spoke about them briefly in an interview with BBC Radio Guernsey. They sued in a case that was eventually settled outside of court, with the BBC apologising and paying £11,000 to charity.

This home near Sark in Brecqhou was built by the Barclay brothers and is worth an estimated £80 million.

It is easy to understand why. After spending many years researching their family’s story for a forthcoming book, I can see the interest in them. The twins were born in October 1934 and lived with their older siblings in a 700 square foot two-bedroom apartment in London Shepherds Bush before the war. In December 1947, their travelling salesman father died. They were only 13 years old. Soon after, they began working in GEC’s accounts department and also as painters. The couple moved into the property market in west London during the 1950s when there was a great deal of opportunity to make money from the increasing demand and lack of housing supply.

In an interview with the Guardian in the 1980s David Barclay said that they went to the “school adversity”. They were more likely to talk about their lack of formal education rather than how they got started in business.

The early years of their financial success have been the least known. A Who’s Who listing only mentions Frederick as a “former agent”, before mentioning them as “joint owners” of the Cadogan hotel from 1968 to 1978. Before that, both brothers were builders and decorators, and in 1960 their involvement in an corner shop caused them to be declared bankrupt.

The Barclays had a great deal of success in 1965 when they turned some large, run-down houses into hotels. In the early 1970s, they had purchased and sold 15 hotels within a little over ten years.

Barclays was shrewd and clever, but also hardworking. They also benefitted from the astonishing rise in London property values, as well the increase of financial institutions willing to loan them money. The Barclays borrowed several millions pounds from Crown Agents, an agency that was set up by the British Empire as a quasi-government procurement agency. They survived the scandal relatively unscathed. The Crown Agents were criticized by a government investigation for the use of public money, at great cost to British taxpayers. When Barclays needed to raise large amounts of money in the future, they would tend to use a select group of lenders, away from the public markets.

They made their first million dollars in London real estate, but they hit it big when they bought Ellerman Lines in 1983, a shipping group and brewing company. The brothers insisted on confidentiality throughout the negotiations with a chairman that seemed to be out of his depth, trying to figure out how “two small men dressed like yachting” with little income could afford a historic shipping conglomerate. The brothers sold the shipping division of Ellerman five years after buying it for £45million.

The name Ellerman is still used as the main executive office of a family that owned complex networks of businesses.

The majority of their large deals from the 1980s until the purchase of the Telegraph was 2004 were financed through borrowings from a few lenders, including HBOS. This bank, based in Edinburgh, collapsed during 2008’s credit crunch. HBOS, the Edinburgh-based bank that collapsed during the credit crisis of 2008, was acquired by Lloyds in January 2009. This led to the shock seizure this week of the Telegraph Media Group, including the Spectator and the Telegraph titles.

Rumours of a large debt were circulating for some time, due to the difficult trading conditions across the empire. Aidan sold his boat in 2017, and the first indications were that in October 2019, the family was considering selling some of its most valuable assets.

The decision of Sir Frederick Barclay to give a portion of his business to three of his nephews including Aidan in the centre was “the biggest mistake of all my life”.

The recent developments have shed more light on the complex corporate structure of the family, which includes several layers located offshore. Lloyds has reportedly become more concerned with mounting debts and unpaid interests. The bank asked AlixPartners, a receivership firm, to take over B.UK. This is the Bermuda-based holding for TMG, and its Jersey-based immediate parent May Corp. The bank called this “an act as a last resort” following the failure of numerous discussions with B.UK’s parent company Penultimate Investment Holdings Limited. The British Virgin Islands is the home of this company.

The family is continuing to negotiate, and it’s believed that they made a final effort to gain control on Thursday by making another offer.

Two court cases revealed more information about the family in 2019 than they had in the preceding four decades. Legal actions surprised those who knew the twins because they revealed the siblings and their children, once inseparable, on opposing sides of the courtroom.

Sir Frederick and Amanda, his daughter, sued Sir David’s three sons, and a longtime corporate consignee in January 2020 for listening to their private conversations. The room was at the Ritz Hotel. Frederick called it a “commercial espionage of a large scale”.

He had not spoken to his twin for many years, mainly because of a disagreement over money and succession. In the 1990s at the height of their business success, Frederick gave up his half share to his nephews. The eldest had taken over the management of the empire. In the middle of a High Court battle that cost him £7.5million, Sir Frederick called his decision “the worst mistake of my entire life”. According to Lady Hiroko, his former wife, he only agreed to the agreement after a heated argument that led to a fight on their yacht, Lady Beatrice.

Frederick only settled with his nieces after David, Frederick’s wife of 34 years and mother of Amanda, died in January 2021. In March 2021 a High court judge ordered him to pay Hiroko his wife and mother of Amanda £100 million. She had filed for a divorce. He has not paid the lump sum for more than two years and was found in contempt after failing to pay £245,000 legal fees and maintenance.

The Barclays have attempted to stop the reporting on their divorce several times, but they’ve mostly failed. Since last July, the public has been interested in why a knight whose empire still is worth more than £6 billion cannot pay his ex-wife.

In 2020, The Ritz Hotel was reported to have been sold for £800 million

Sir Frederick told the court that he couldn’t afford to pay, because he handed over control of his business empire to three nephews who had “turned off” the tap since the business began to struggle in 2019.

Sir Jonathan Cohen has summoned Aidan Barclay and Howard Barclay for testimony. Last month, Aidan Barclay gave evidence. He said that it was “not accurate” to say the “tap” was turned off in 2019. However, he did admit business had been “difficult”. . . In the past two years, we have faced severe pressures within the business. He said that selling the Ritz early in 2020 for an estimated £800 million only increased the corporate coffers between £100 and £150 million.

After years of financial success, borrowing money from lenders who were always willing to lend, and buying low, then selling high, the debts accumulated before the 2008 Crash are now due.

When times are hard, lawyers and lenders reveal secrets that were kept secret during the glory days. Sir Frederick, 88 years old, still faces the possibility of going to prison and having his family split up. How his story ends may depend on the coming months.