Lord Saatchi, amongst others, considering a bid for The Telegraph
Can a consortium formed by the advertising mogul revive the prestigious newspaper?
Words: Charlie Bentley
Lord Saatchi, the advertising legend known for propelling Margaret Thatcher to power, is contemplating a bold bid for The Telegraph. The media world is frantic with speculation about the potential for an acquisition.
According to multiple sources, Lord Saatchi is in discussions to form a consortium for the bid. His rumoured partner in this venture is Lady Lynn Forester de Rothschild, a former director of The Economist Group. The duo has reportedly been in talks with several financial backers, although details remain elusive, and insiders caution that these discussions may not culminate in a definitive offer. So far, Abu Dhabi-backed RedBird IMI investment fund has received several bids for the Daily Telegraph; it is expected that the assets in total will sell for over £600 million. Yet, financial analyst Alice Enders, a media analyst at Enders, has stated that it's “a stretch” to state that the whole newspaper group is worth this much.
The media attention seems to be focused on Saatchi. Lord Saatchi’s illustrious career in advertising began with Saatchi & Saatchi, the agency behind the iconic "Labour Isn’t Working" campaign, a pivotal factor in the Conservative Party’s electoral successes in the late 1970s and 1980s. Despite no longer being actively involved with his eponymous agency, his name still carries considerable weight in the business world.
The backdrop of this potential bid is the recent turmoil surrounding The Telegraph and its parent company. Lloyds Banking Group seized control of the company from the Barclays family due to a dispute over £1.2 billion in overdue loans. Although the Barclays family repaid the debt with a loan from Sheikh Mansour bin Zayed Al Nahyan, the subsequent call option granted to RedBird IMI was blocked by new legislation designed to prevent foreign state influence over UK newspapers.
The Telegraph is now up for auction again, and Lord Saatchi is not the only interested party. Other potential bidders include Sir Paul Marshall, a hedge fund tycoon, and Lord Rothermere, proprietor of the Daily Mail. The competition is expected to be fierce, given the prestigious nature of the media titles involved.
Despite its storied history, The Telegraph faces significant financial challenges. Recent accounts revealed a £278 million provision related to loans to the Barclay family, contributing to a record loss of £245 million last year. This financial black hole underscores the daunting task awaiting any potential new owner.
For Lord Saatchi, acquiring The Telegraph could be seen as a strategic move to influence public discourse and bolster conservative media voices. His potential collaboration with Lady de Rothschild, a self-made millionaire and founder of the Coalition for Inclusive Capitalism, adds an intriguing layer to this prospective bid. Together, they could bring a blend of traditional and progressive perspectives to the newspaper’s leadership.
Others interested in a purchase include hedge fund boss Sir Paul Marshall and Rupert Murdoch. As the bid deadline approaches, the focus seems to be lying on Lord Saatchi and his potential consortium. Whether or not they proceed with a formal offer, the mere possibility has already sparked considerable interest and speculation within the media industry. The question now to be asked is whether Saatchi is the right man for the job to breathe new life into the newspaper.
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