While the Telegraph sale is on course to be blocked in its current form, it could potentially still get the go ahead if a different ownership structure is agreed.
The government plans to ban foreign governments from owning British newspapers and magazines – effectively blocking an Abu Dhabi-led takeover of the Daily and Sunday Telegraph.
The commitment was set out in the House of Lords this afternoon in an amendment to the third reading of the Digital Markets Act, which is currently making its way through Parliament.
Culture minister Lord Parkinson said: “We will amend the media merger regime explicitly to rule out newspaper and periodical news magazine mergers involving ownership, influence or control by foreign states.”
He added: “Under the new measures the secretary of state would be obliged to refer media merger cases to the Competition and Markets Authority (CMA) through a new foreign state intervention notice.”
The secretary of state, the peer said, would be obliged to block deals found to contravene the CMA’s tests.
The move was welcomed by The Spectator’s chairman, the veteran journalist Andrew Neil, in a Sky News interview.
He told Politics Hub with Adam Parsons the government was effectively forced into the move due to the swell of political opposition to the proposed takeover of the Telegraph titles and The Spectator magazine by RedBird-IMI.
Mr Neil argued the deal was technically dead, and added: “Our understanding is that there would be no cut-off point. The cut-off point is zero per cent. Redbird will not be able to dilute this.
“Our understanding is that a foreign government can have no percentage in this kind of deal and the other good thing that we learned just a couple of hours ago is that it explicitly includes The Spectator… We’re covered by this too.”
He confirmed he would have left his position had the RedBird takeover gone through.
The US-Abu Dhabi joint venture is 75% owned by Sheikh Mansour, vice president of the United Arab Emirates (UAE).
The future of the Telegraph titles has been the subject of fierce debate in Conservative circles since RedBird circumvented a formal auction by repaying money owed to Lloyds Bank by former owners the Barclay family, who had put the newspapers up as security.
Former Tory leaders Lord Hague and Iain Duncan Smith opposed the takeover arguing that it was inappropriate for significant media assets to be effectively owned by a foreign state.
Source: https://news.sky.com/story/government-to-effectively-block-abu-dhabi-led-telegraph-takeover-13094008