Abu Dhabi cash could win the battle for UK’s top Tory media titles

Mr Murdoch has reportedly been eyeing off The Spectator, while hedge fund millionaire Paul Marshall wants to add the two Tory titles to his portfolio of start-up right-wing media ventures, which includes voluble TV station GB News.

The Gulf proposal comes jointly from US-based private equity firm Redbird Capital and Abu Dhabi group International Media Investments (IMI), which founded English-language daily The National in the United Arab Emirates and has interests in CNN Business Arabic, Sky News Arabia and Euronews.

The joint venture, RedBird IMI, is run by former CNN chief Jeff Zucker, who the bidders say would take over “management and operational responsibility for the titles”, while IMI would be “a passive investor only”.

RedBird IMI and IMI itself would each lend the Barclay family £600 million, secured against the family’s assets – one against the media properties, the other against the Barclays’ other holdings such as online retailer Very.

This would pay off the Barclays’ debt to Lloyds, after which one of RedBird IMI’s loans would be converted into an equity stake in the Telegraph.

This has triggered concern in the governing Conservative Party, reportedly egged on by Mr Marshall, which has rippled upwards into the cabinet room.

Culture, Media & Sport Secretary Lucy Frazer said in a parliamentary statement that she was “minded to” issue a public interest intervention notice (PIIN), to ensure any deal ensured “the accurate presentation of news and free expression of opinion” in the newspapers.

In a letter to RedBird, she said she was “aware that RedBird IMI [has] links to media organisations that have been critiqued for partisan views and therefore believes there may be an impact on the plurality of views of newspapers in the UK”.

Fleet Street has been following the story with rapt attention. The Times reported on Friday that IMI RedBird’s chairman is Sultan Ahmed al Jaber, who heads UAE’s state oil company but was also chair of the National Media Council from 2010 to 2015.

The paper said Amnesty International had criticised him for “exercising strict control over local and international media” in that role, including by banning a popular Dubai website after it reported on the liquidation of failed property projects.

Former Telegraph and Spectator editor Charles Moore used a column in the newspaper on Friday to rail against the newspaper’s “nationalisation” into the hands of a foreign government.

“It would be nationalisation by a country which does not have press freedom,” he said. Noting RedBird IMI’s pledge of editorial independence, he said: “I would not say that these promises are insincere. I merely observe that they are always made in controversial media takeovers and end up making little difference to the structure of real power.”

RedBird IMI’s Mr Zucker on Friday told the Financial Times he would guarantee the titles’ independence via an editorial advisory board, and accused rival bidders of “slinging mud and throwing darts”.

Some newspapers also reported that the Foreign Office was trying to tone down Ms Frazer’s comments on the proposal, to avoid a diplomatic spat with the UAE. She will have to decide this week whether to opt for a PIIN. This would launch a process potentially lasting several months, in which the communications and competition regulators would make a formal assessment of the deal.

To meet any regulatory concerns, IMI may have to step further back from the deal. But previous PIINs have ultimately not prevented takeover forays from going ahead, including a Saudi Arabian play for the Evening Standard and Independent newspapers.

According to the Financial Times, Lloyds is keen for the RedBird IMI deal to proceed. This is because the bank would fully recoup the debt, which is not likely to happen under an auction process for the two titles.

Other potential bidders reportedly interested in the auction are DMGT, which owns the Daily Mail tabloid, German behemoth Axel Springer, Belgian publisher Mediahuis and Czech billionaire Daniel Kretinsky.

RedBird IMI said their plan was to expand the titles “in the UK, the US and other English-speaking countries”. The Spectator already has an Australian edition, while Telegraph articles appear in Nine’s masthead, including The Australian Financial Review, under a syndication deal.

Mr Zucker told the FT that in the US, the Telegraph could be a centre-right counterweight to liberal mastheads such as the New York Times and Washington Post.