In an effort to realize a longstanding aspiration of consolidating ownership of the Daily Mail and the Daily Telegraph, Lord Rothermere is engaged in talks with potential investors, according to
sources revealed to Sky News.
Lord Rothermere, who chairs DMGT and dmg media, is actively seeking financial backing to support his bid for the Telegraph newspapers. He is reportedly in discussions with various investment funds, including those from the Middle East.
Sources close to the situation have indicated that if the Daily Mail proprietor forms a consortium with external investors, individual investors are unlikely to possess more than a 20% stake in the Telegraph titles.
A spokesperson from DMGT issued a statement confirming that discussions have taken place concerning possible synergies between DMG Media and the Daily Telegraph. However, the statement clarified that there are no formal plans or established consortium at this stage.
This confirmation marks the first official acknowledgment of Lord Rothermere's pursuit of the Telegraph acquisition, a goal he has harbored for a considerable period.
In recent news, it was reported that the holding company of the Telegraph titles has enlisted Goldman Sachs, a prominent Wall Street investment bank, to oversee the upcoming auction of the esteemed British newspaper publisher. Lloyds Banking Group, which gained control of the newspapers following a complex negotiation with their former owners, the Barclay family, aims to value the Telegraph titles around £600 million.
The auction is projected to commence in the autumn, encompassing the sale of the newspapers as well as The Spectator, a current affairs magazine chaired by veteran political broadcaster Andrew Neil.
While Lord Rothermere has expressed interest in potentially acquiring The Spectator, his primary focus remains on securing the Telegraph titles. Potential competition concerns arising from a DMGT takeover of the right-leaning newspapers have been discussed; however, industry analysts suggest that such concerns are surmountable.
External financing is expected to be necessary for Lord Rothermere to submit a credible offer for the acquisition. The identity of the investment funds involved in the talks remains undisclosed at this time.
Hitherto, National World, a regional newspaper publisher led by industry veteran David Montgomery, is the sole entity to have publicly expressed interest in bidding for the Telegraph.
Telegraph Media Group recently disclosed its full-year results, indicating a one-third rise in pre-tax profits to approximately £39 million in 2022. The company attributed this growth to a successful digital subscription strategy and effective cost management.
The impending sale will be overseen by a newly appointed board of directors, led by Mike McTighe, who chairs Openreach and IG Group. McTighe has also been named chairman of Press Acquisitions and May Corporation, the parent companies of TMG and The Spectator.
Goldman Sachs' involvement adds to the array of professional advisors guiding the future of one of the UK's most influential newspaper groups. Photo by Alex.muller, Wikimedia commons.