Telegraph Takeover Drama Ends With Deal to Sell U.K. Newspaper to Private Equity
RedBird Capital Partners, an American investment firm, said on Friday that it reached an agreement in principle to buy control of the newspaper's parent company, Telegraph Media Group, at a valuation of 500 million pounds, or about $675 million.
Friday's deal marks the latest twist in a long-running takeover drama for The Telegraph, which for much of its 170-year history has been considered a house organ of sorts for Britain's Conservative Party. (Among its nicknames is The Torygraph.)
RedBird had already bought control of the newspaper via a joint venture with International Media Investments, a fund controlled by a member of Abu Dhabi's royal family. Under that plan, the newspaper would have been overseen by Jeff Zucker, the former president of CNN.
But that deal was blocked in 2023 after an outcry in Parliament over foreign state ownership of British media assets. Last year, the Conservative-led government passed a law barring foreign state investors from owning British newspapers.
The joint venture, known as RedBird IMI, retained control of The Telegraph while soliciting other bids.
Following the collapse of RedBird IMI's plan, other media moguls were reportedly considering bids for the newspaper. The most ardent was Dovid Efune, the British-born owner of The New York Sun, though he had struggled to line up financing ahead of a deadline late last year.
The Spectator, an influential magazine that was part of the same holding group as The Telegraph, was sold for £100 million last year to Paul Marshall, a British hedge fund tycoon with media interests that include the right-wing TV channel GB News.
As part of Friday's deal for The Telegraph, RedBird will buy the majority of its Emirati partner's holdings, though IMI is expected to retain a small stake, pending a change in the foreign ownership law.
The current government, led by the Labour Party, announced last week that it would relax that restriction, allowing foreign state entities to own stakes of up to 15 percent in newspapers. It cited the importance of attracting investment in the news media. That opened the door for the revised RedBird offer, since IMI is a minority investor in its consortium.
RedBird said it was in talks to line up British investors as minority owners 'with print media expertise and strong commitment to upholding the editorial values of The Telegraph.'
The 11-year-old RedBird is a well-known media investor, whose holdings include stakes in the movie studio Skydance Media; Fenway Sports Group, which owns the Boston Red Sox baseball team and the British soccer club Liverpool F.C.; and the New York Yankees' regional sports network.
The investment firm said it planned to expand The Telegraph's international footprint, 'particularly in the United States,' as well as its digital operations.
'We believe that the U.K. is a great place to invest, and this acquisition is an important part of RedBird's growing portfolio of media and entertainment companies in the U.K.,' Gerry Cardinale, the founder of RedBird, said in a statement.
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