Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Conservative MPs have called for the government to use the UK’s national security laws to investigate the attempt by the Barclay family to take back control of the Telegraph newspaper group using funding from Abu Dhabi.
MPs, including Edward Leigh, John Hayes and Baroness Margaret Eaton, have written to deputy prime minister Oliver Dowden, business secretary Kemi Badenoch and culture secretary Lucy Frazer questioning the use of overseas sovereign wealth to buy the UK national newspaper.
The Daily Telegraph is traditionally the newspaper most aligned to the Conservative party — Boris Johnson wrote a weekly column for the broadsheet before he became prime minister — which has caused some concern over its future ownership among the party’s MPs.
The media group was put into receivership by Lloyds Banking Group earlier this year owing to unpaid debts and has since been put up for sale by the bank in an auction.
However, the Barclay family has in recent days offered to repay all of the £1.1bn in outstanding debt. This would be funded by debt provided by an Abu Dhabi royal family member and RedBird IMI, an investment vehicle headed by former CNN boss Jeff Zucker that is also part-backed by Abu Dhabi-based International Media Investments.
The MPs said in the letter that they were concerned that investment vehicles with links to the Emirati royal family “may soon gain control of or material influence over two of the most important media publications in Great Britain, The Telegraph and The Spectator”.
They argue that there “is a strong case for close scrutiny by the government under both the Enterprise Act 2002 and the National Security & Investment Act 2021” — especially if the offer involved taking the publications as security for the loan, “an amount which, by any sensible measure, the revenue of the publications will not be able to support”.
The letter marks the first time that Tory MPs have specifically questioned the Barclay family’s ties to Abu Dhabi, rather than just warned over foreign influence in the acquisition of the newspaper group.
“Material influence over a quality national newspaper being passed to a foreign ruler at any time should raise concerns, but given the current geopolitical context, such a deal must be investigated,” the MPs said in the letter.
“Clearly, this represents a potential threat to press freedom in this country, and given the position of influence that these publications hold, a risk of issues pertaining to national security not being reported accurately.”
Concerns by MPs may have little effect on any decision by Lloyds over the future of the newspaper given the family have the legal right to repay the debts.
Next week, a court hearing to liquidate a holding firm that sits above the group — which is in effect the final part of the receivership — is expected to be adjourned to allow more time for the family to structure the deal with Lloyds.
The family’s backers still need to do due diligence, and the bank needs to be sure of the funding, but if the family finds the money to repay the debt in full then the auction of the newspaper will be stopped.
The MPs argue that the Barclay family deal could be investigated through a public interest intervention notice (PIIN).
But the Barclay family said in a statement that there was “no precedent and no basis for a PIIN being issued in relation to a debt transaction, and we are highly confident that the family’s proposal would not trigger any regulatory reviews regarding the ownership of the media assets”.