Potential suitors to buy the Daily and Sunday Telegraph have until the end of Friday to submit second-round offers, with the US owner of the New York Sun and Sir Paul Marshall, the backer of GB News and the new owner of the Spectator, viewed as the frontrunners to win the auction.
Marshall, who earlier this month sealed a £100m deal to buy the Spectator magazine, is leading a consortium backed by Ken Griffin, the US billionaire founder of the Citadel hedge fund.
Earlier this week, the Spectator appointed the former cabinet minister Michael Gove as its new editor, taking over from Fraser Nelson, who has held the role since 2009.
Marshall has been widely considered the frontrunner to win the auction, but there are at least four known suitors expected to submit bids before the deadline.
Earlier this month, British-born Dovid Efune, who took control of the digital assets of the right-leaning former print newspaper the New York Sun three years ago, emerged as a serious rival contender.
Efune has reportedly secured the backing of institutions including the US investment funds Oaktree and Hudson Bay Capital, the family office of the hedge fund manager and philanthropist Michael Leffell, and the investment arm of the Canadian developer Beedie.
Several sources believe that Efune, a former editor of the Jewish publication the Algemeiner Journal, may have the edge over Marshall because he does not control any UK media assets that may spark political and regulatory investigations.
Should Efune triumph in the auction, it could lead to Conrad Black reviving links to the titles he once owned.
Black, who is listed as a contributing editor and a founding director on the New York Sun’s website, was convicted of fraud and obstruction of justice in 2007 and spent three and a half years in prison.
A Canadian-born British citizen, Black was pardoned by the former US president Donald Trump in 2019, with the White House saying he was “entirely deserving” of clemency.
RedBird IMI – the consortium backed by Sheikh Mansour bin Zayed al-Nahyan, the vice-president of the United Arab Emirates and the owner of Manchester City football club, and the US investment firm RedBird Capital Partners – paid £600m to take control of Telegraph Media Group in November last year from the Barclay family.
However, the deal was referred to UK regulators over press freedom and competition concerns.
RedBird IMI was forced to put the Spectator and Telegraph titles back up for sale in the spring after the British government published legislation to block foreign states or associated individuals from owning newspaper assets in the UK.
After the successful sale of the Spectator, Red Bird IMI needs a £500m offer for the Telegraph titles to recoup its investment.
Efune is thought to be preparing a bid of about £550m, while the ceiling of Marshall’s offer is unknown.
The Barclay brothers paid £665m for TMG in 2004.
Other bidders that have been revealed and have not publicly said they are not submitting second-round bids include the former chancellor Nadhim Zahawi.
Zahawi was originally involved as a “middleman”, introducing RedBird IMI to the Barclay family, which enabled them to repay £1.16bn in loans and take back control of the debt-laden business from Lloyds Banking Group last year.
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He was subsequently tipped to become the chair of the media group if RedBird IMI was able to complete a takeover.
However, after RedBird IMI converted its loans to the Barclays into control of the Telegraph titles, it was forced to put them back up for sale.
National World, the UK-listed company that owns regional titles including the Yorkshire Post and the Scotsman, is also thought to be still in the frame.
Efune is understood to have attended a senior management presentation at the Telegraph. National World has attended two.
However, one source said that the meetings were not an indicator of frontrunners because much of the work and due diligence was being done between bankers.
In July, Lord Rothermere, the owner of the Daily Mail, pulled out of the auction owing to fears his newspaper group would be pulled into a long and complex battle to allow any takeover to overcome competition and political hurdles.
However, Rothermere is understood to have revived interest, exploring potential options to re-enter the process potentially in partnership with another player, a move that could reduce opposition to a deal.
CVC, the private equity group behind the Six Nations tournament, is understood to have held talks with other bidders about potentially making a joint offer.
However, it is not clear how serious the talks have been or whether any have progressed formally. It is possible that other bidders not yet publicly named could make a bid before the close of the deadline at midnight on Friday.
Depending on how many competitive bids are received, the auction is expected to move to either preferred bidder status – or “best and final offer” stage – later next week.