Abu Dhabi-backed fund pulls out of deal to take over UK's Telegraph newspaper group

Britain’s Telegraph newspaper group is back up for sale after a takeover bid by a United Arab Emirates-backed consortium collapsed

LONDON -- Britain's Telegraph newspaper group is back up for sale Tuesday after a takeover bid by a United Arab Emirates-backed consortium collapsed.

Abu Dhabi-backed investment fund RedBird IMI said it was withdrawing from the proposed acquisition of the Telegraph Media Group, which owns the right-leaning Daily Telegraph and Sunday Telegraph newspapers and The Spectator magazine.

“We continue to believe this approach would have benefited the Telegraph and Spectator’s readers, their journalists and the U.K. media landscape more widely," the fund said in a statement. “Regrettably, it is clear this approach is no longer feasible.”

The proposed deal faced opposition from Britain’s government, which expressed concerns about the impact on freedom of expression and accurate presentation of news. Last month the government said it planned to bring forward legislation that would block foreign state ownership of British newspapers and magazines.

Officials also launched a probe into the proposed deal's potential impact on freedom of speech. Ofcom, the media watchdog, raised concerns that the proposed takeover could influence “the accurate presentation of news and free expression of opinion" in the publications.

The Telegraph papers are closely allied to the governing Conservative Party.

RedBird IMI is backed by U.S. financial firm RedBird Capital Partners and Sheikh Mansour bin Zayed Al Nahyan, a member of Abu Dhabi’s royal family and the UAE’s vice president. It is run by former CNN chief Jeff Zucker.

The fund reached an agreement last year with the Barclay family, the media group's previous owners, to provide loans to them and ensure that the family’s debts, worth some 1 billion pounds ($1.25 billion), are paid.

The Barclay family owned the influential newspaper and magazine before the publications were put into receivership. The family also previously owned London’s luxurious Ritz Hotel before selling it in 2020.