The highly-anticipated auction of the Telegraph newspapers and Spectator titles has come to an unexpected halt. A consortium backed by Abu Dhabi’s International Media Investments and the American firm RedBird Capital has promised to repay the debts owed by the previous owners of the publishing group, the Barclay family. This has raised uncertainty over the future of the auction process, which was being led by bankers at Goldman Sachs.
Lloyds Banking Group had put the publishing group’s parent company, B.UK, into liquidation earlier this year due to £1.1bn of unpaid debts. The sale process was officially launched in October, but now the involvement of RedBird IMI has thrown a wrench into the proceedings. The Barclays have until 1 December to complete due diligence and repay the debts, pending an adjourned court hearing.
The agreement between RedBird IMI and the Barclay family involves a £600m loan secured against the Telegraph and Spectator titles, as well as other Barclay family businesses and commercial interests. RedBird IMI plans to convert the loan into equity at an opportune time. The specific terms of this agreement will be scrutinized by regulators, such as the Competition and Markets Authority and Ofcom, if the culture secretary, Lucy Frazer, determines that a public interest intervention notice is necessary.
If the debts are not repaid by 4 December, it is expected that the holding company will be liquidated and the sale process will resume. Several parties, including a consortium led by Sir Paul Marshall and the owner of the Daily Mail, have expressed interest in acquiring the Telegraph and Spectator titles.
The future of these renowned publications remains uncertain as the Barclay family works to meet their financial obligations. Only time will reveal the outcome of this unexpected pause in the auction process.
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FAQ
What led to the pause in the auction of the Telegraph newspapers and Spectator titles?
An Abu Dhabi-backed consortium, RedBird IMI, stepped in to provide loans to the previous owners of the publishing group, the Barclay family, allowing them to repay their debts to Lloyds Banking Group. This unexpected development has cast uncertainty over the auction process.
What are the terms of the agreement between RedBird IMI and the Barclay family?
RedBird IMI has agreed to provide a £600m loan secured against the Telegraph and Spectator titles, as well as other Barclay family businesses and commercial interests. They plan to convert the loan into equity in the future.
What will happen if the debts are not repaid by 4 December?
If the debts are not repaid by the specified date, it is expected that the holding company will be liquidated and the sale process will resume.
Who else is interested in buying the Telegraph and Spectator titles?
Other interested parties include a consortium led by Sir Paul Marshall and the owner of the Daily Mail.