Lord Rothermere’s Daily Mail & General Trust (DMGT) today confirmed that it has pulled out of the bidding race to take control of the Telegraph titles.
In a statement issued this morning, the newspaper group said that discussions with venture capital group, CVC Capital Partners, who have been leading the consortium relating to the sale of Hollinger International assets, have now terminated.
It was reported that Lord Rothermere was in pole position to take control of the Hollinger international owned newspapers titles which include, the Daily Telegraph, Sunday Telegraph and Spectator magazine, after a seemingly unbeatable cash bid of nearly £700 million was made at the beginning of this month (see ITV Revenues Up As Next Three Year Targets Unveiled).
DMGT joined the CVC Capital Partners consortium to avoid any objections from media regulators after concerns were raised that it may face investigation by the competition authorities, given its ownership of the Daily Mail, the Mail on Sunday and the Evening Standard.
The DMGT’s exit from the race now leaves two remaining bidders; firstly the Barclay Brothers, who are the reported favourites to take control and secondly a consortium led by the venture capital firm 3i.
At the beginning of this year, the Barclay Brothers made an offer of £260 million for the newspaper titles but this was rejected by Hollinger International (see Hollinger Moves To Scupper Black’s Telegraph Sale).
Hollinger is expected to announce the Telegraph’s new owner within the next few days. However, the bidding process may be delayed following an admission from the newspaper group that it had mistakenly overstated circulation figures for its Chicago Sun-Times title over several years.
Hollinger claims it is now trying to pinpoint what caused the errors and said that similar investigations at the Daily Telegraph and Sunday Telegraph had not revealed any erroneous circulation figures.
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