Culture Secretary Lisa Nandy is poised to consider launching a formal investigation into the proposed £500 million acquisition of the Telegraph titles by the owner of the Daily Mail. This follows a formal request submitted to her department by the newspapers' current Abu Dhabi-backed owner, RedBird IMI.
The Deal and Its Complex Funding
The move comes after Daily Mail & General Trust (DMGT), controlled by Lord Rothermere, finalised a complex £500 million funding package to acquire the Telegraph Media Group. This package includes cash, an existing overdraft, and a loan from its banker NatWest. DMGT has been in exclusive talks with RedBird IMI since last month.
RedBird IMI was forced to put the prestigious Telegraph titles up for sale last spring after the UK government introduced a ban on foreign states owning British newspapers. The fund had taken control of the publications in 2023 by paying off loans owed to Lloyds Bank by the previous owners, the Barclay family.
As part of the intricate agreement, RedBird IMI has agreed to wait two years before receiving the final £100 million payment from DMGT. This final tranche is expected to be funded from a DMGT bond with Deutsche Bank that matures in 2027.
Regulatory Scrutiny and Public Interest
Nandy will now inform Parliament of the formal request and must decide whether to issue a Public Interest Intervention Notice (PIIN). Triggering a PIIN would involve media regulator Ofcom and the Competition and Markets Authority (CMA) examining the deal for potential threats to media plurality and competition.
Analysts widely expect Nandy to initiate the initial investigation phase, which can last up to 40 working days. Depending on the findings, she could then order a more in-depth, second-phase probe. The deal would consolidate a significant portion of the UK's national newspaper market, bringing the Daily Telegraph, Sunday Telegraph, Daily Mail, Mail on Sunday, Metro, i newspaper, and New Scientist under the Rothermere ownership umbrella.
"DMGT is determined to proceed at pace towards a resolution that brings much-needed certainty to Telegraph Media Group employees after a protracted period of instability," a DMGT spokesperson stated. They reiterated that the acquisition would be free from foreign state influence and that the Telegraph would maintain editorial independence while receiving investment for international growth.
Path to a Final Decision
If the deal ultimately gains approval, Nandy would lift the pre-emptive orders imposed by her predecessor, Lucy Frazer. These orders currently prevent RedBird IMI from making any significant changes to the Telegraph's structure, staff, or management without government consent.
Independent analyst Alice Enders commented, "My judgment is the deal will of course be scrutinised, competitors might complain, but there is a strong foundation for clearance. I don't think a phase two will be deemed necessary, and therefore there won't be any remedies such as a sale of other titles required on competition grounds."
DMGT has pledged to uphold the Telegraph as a beacon of authoritative news amidst fierce digital competition. The coming weeks will determine whether regulators agree that this consolidation serves the public interest.
