The UK government has announced its intention to conduct a review of the proposed acquisition of the Telegraph Media Group by Abu Dhabi-backed investment fund RedBird IMI, citing potential public interest considerations. RedBird IMI revealed its plan to acquire control of The Daily Telegraph, The Sunday Telegraph, and The Spectator magazine on Monday, raising concerns about the influence it may exert on the operations of The Telegraph.
British Media Secretary Lucy Frazer expressed her apprehensions in a public letter addressed to RedBird IMI, disclosed on Wednesday. In the letter, she conveyed the government’s inclination to issue a public interest intervention notice, stating that concerns have prompted further investigation into potential public interest implications of the deal.
RedBird IMI, a joint venture between US firm RedBird Capital and Abu Dhabi’s International Media Investments, clarified on Wednesday that it remains committed to retaining the existing editorial team of The Telegraph and The Spectator magazine. The consortium revealed that it has secured loans totaling around £1.2 billion ($1.5 billion) to take control of the parent company of the right-leaning titles.
The Telegraph group, under the control of twin brothers Frederick and David Barclay for nearly two decades, faced financial challenges leading to the decision to sell. The Bank of Scotland appointed a receiver for the Bermuda-based holding company in June due to unpaid debts, initiating the sale process.
RedBird IMI’s announcement included plans to fully repay the debts, enabling the media group’s removal from receivership. The joint venture also expressed its intention to convert a substantial loan, secured against The Telegraph and The Spectator titles, into equity. RedBird Capital, led by former CNN president Jeff Zucker, would then oversee the publications independently, with IMI adopting a passive investor role.
However, the proposed takeover has sparked concerns among some lawmakers in the Conservative party, prompting a group of Tory MPs to call for a government investigation. They questioned the wisdom of allowing overseas sovereign wealth funds to acquire national newspapers. British Media Secretary Lucy Frazer emphasized that the review could explore public interest grounds outlined in the Enterprise Act 2002, such as the accurate presentation of news and the free expression of opinion in newspapers.
Frazer clarified that a final decision on intervention had not been made, inviting further representations from involved parties until 15:00 GMT on Thursday. The unfolding situation underscores the intricate dynamics surrounding the potential acquisition and the balance between foreign investment and safeguarding national media interests.
