The media funding automobile, which is a three way partnership between RedBird Capital Partners and the United Arab Emirates-based International Media Investments, mentioned in a assertion Monday that it had agreed to lend the Barclay household £600 million ($750 million), secured in opposition to the politically influential titles.
“Under the terms of this agreement, RedBird IMI has an option to convert the loan secured against the Telegraph and Spectator into equity, and intends to exercise this option at an early opportunity,” the funding automobile mentioned in a assertion.
Lloyds Banking Group Plc seized the Telegraph titles together with the Spectator magazine from the Barclay household in June to claw again money owed, eradicating Barclay relations from their director positions and inserting the companies in receivership. The RedBird IMI loan will assist the Barclay household to repay the debt owed to Lloyds.
Separately, IMI will lend a additional £600 million secured in opposition to different Barclay household companies and business pursuits. IMI is a personal funding automobile for Sheikh Mansour Bin Zayed Al Nahyan, in keeping with a spokesman for RedBird IMI, whose assertion emphasised IMI’s involvement would be passive.
“Following transfer of ownership, RedBird Capital alone will take over management and operational responsibility for the titles under the leadership of RedBird IMI Chief Executive Jeff Zucker,” the assertion mentioned, referring to the former president of CNN. “International Media Investments will be a passive investor only.”
Still, RedBird IMI’s assertion will doubtless heighten concern amongst Conservative lawmakers, who’re pushing the UK authorities to scrutinize the UAE’s involvement. Lawmakers have described any potential affect of the UAE royal household over the Telegraph as “a risk to our national security,” citing its document on press freedom and place on Israel.
The prospect of overseas affect on the title has already raised issues amongst senior ministers together with Kemi Badenoch and Tom Tugendhat, Bloomberg News reported Saturday.
“Any transfer of ownership will of course be subject to regulatory review,” RedBird IMI mentioned in its assertion, which pledged to keep up the present editorial group of the publications. “We will continue to cooperate fully with the government and the regulator.”
Even earlier than that, UK Culture Secretary Luzy Frazer may subject a so-called Public Interest Intervention Notice. That would launch a research of the deal by British regulators. She may additionally freeze the transaction whereas that occurs, if she chooses. The antitrust watchdog – the CMA – and media regulator Ofcom will report findings on antitrust and media points respectively, to tell Frazer’s remaining determination, which may see her clear the deal, block it, or impose circumstances.