(1 day, 6 hours ago)
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Lord Fox
To ask His Majesty’s Government what assessment they have made of reports of the withdrawal of the RedBird bid for ownership of the Telegraph Media Group.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
My Lords, the Secretary of State and I are acutely aware that the Telegraph and those who work there have been in limbo for too long. We are keen for this to be resolved as soon as possible in the public interest. The Secretary of State has now received a formal withdrawal of RedBird IMI’s request to progress the sale of the call option to RedBird Capital Partners. I am sure the noble Lord will understand that I cannot provide a running commentary or go into detail on this commercially sensitive live case. The Secretary of State will update Parliament when regulatory decisions are made.
Lord Fox (LD)
I thank the Minister for that Answer. When the Government hastily tabled the statutory instrument that was specifically designed to allow RedBird to make its acquisition, it was crystal clear to many of us that the deal was wrong. Now the financial wreckage left behind by RedBird’s exit is very complex. For example, some reports suggest that Abu Dhabi-based International Media Investments could retain huge residual interest in the Telegraph and, depending on the final price of any sale, that could be well more than 15%. The Telegraph Media Group clearly needs a white knight acquirer, but to ensure the best interest does the Minister agree that none of the players involved in the deals to date should be driving the sale process? Does she also concede that, given DCMS’s failure to read the financial room, it too should stand aside in favour of the Cabinet Office or perhaps an external adviser experienced in dealing with these kinds of complex issues?
Baroness Twycross (Lab)
The Secretary of State has adhered to the letter of the law and diligently carried out her quasi-judicial responsibilities. There is no basis to the suggestion that the decision should be made elsewhere. Securing a swift outcome in the public interest is a priority for her, and she will continue to act within the bounds of the regulatory framework as set out in the Enterprise Act 2002. Noble Lords wanted powerful legislation to prevent foreign states from owning a stake in our newspapers and rightly so. Now we must allow for resolution to be sought to secure stability for the Telegraph.
Baroness Stowell of Beeston (Con)
My Lords, it is 18 months since this House effectively forced RedBird IMI to sell the Telegraph. It is more than unacceptable that the Telegraph’s ownership remains unresolved. Can the Minister confirm that IMI, the Emirati fund, cannot transfer any debt on to the Telegraph that it incurred from paying an inflated £500 million for the business and that such a poison pill would breach all legal limits on foreign state investment funds as well as the law preventing foreign states from owning, controlling or influencing a British newspaper?
Baroness Twycross (Lab)
The parties have given public assurances that this is not how the deal has been structured, which the Secretary of State was pleased to see, and I hope gives reassurance to the noble Baroness. They stated:
“The structure of the transaction has always been that upon any sale, the security and guarantees granted by the Telegraph companies in respect of the Redbird IMI loan will be fully extinguished and discharged. Further, the Telegraph would not assume any debt owed by the Barclay family”.
On that basis, it is not my current understanding that the Telegraph would be responsible for the debt. I hope that gives the noble Baroness the reassurances she requires.
Lord Forsyth of Drumlean (Con)
My Lords, has this uncertainty for the staff and for a great national newspaper not gone on long enough? Should the Secretary of State not use her powers to get the Competition and Markets Authority to put this on a block so that there is a proper option and normal order can be restored?
Baroness Twycross (Lab)
It would be inappropriate for me to speculate on the potential approaches that might be taken at this stage, although I and the Secretary of State are keenly aware that the sale process has taken too long. We are clear about the negative impact of this uncertainty, not least on the Telegraph staff. For this reason, the Secretary of State will be moving this forward as a priority. However, the need for decisive action cannot overshadow the need for thorough and diligent consideration of the approach which will deliver the best outcome.
Lord Naseby (Con)
Has the Secretary of State thought about approaching the mutual world? It is highly successful in the United Kingdom at the moment, both in the financial dimension and across a whole spectrum of activity.
Baroness Twycross (Lab)
I am not privy to the Secretary of State’s thinking on this matter, but I will pass on the noble Lord’s suggestion.
Lord Young of Acton (Con)
My Lords, I declare an interest as a Telegraph contributor and as the director of the Free Speech Union. Can the Minister assure the House that, in keeping with the principle that foreign states should not be able to exercise any influence over the editorial content of a British newspaper, foreign states should not be able to exercise any influence over the sale of a British newspaper either? To repeat the request of the noble Lord, Lord Fox, assuming that the Minister agrees with that principle, will she ask the Secretary of State to guarantee that RedBird IMI is not involved in the decision regarding to whom the Telegraph is sold?
Baroness Twycross (Lab)
As I have said previously, it would be inappropriate for me to comment on any live merger case. I agree with all noble Lords who have stated their support for the Telegraph, which is a world-renowned title, with a long and proud history that we want to see continue. The public interest intervention notice and pre-emptive action order on RedBird IMI’s proposed acquisition of the Telegraph both remain in place. As I have stated previously, the Secretary of State is keen to make sure that the matter is resolved, as she agrees, as I am sure do noble Lords from across the House, that the sale process is taking too long.
Lord Parkinson of Whitley Bay (Con)
My Lords, I welcome the Minister’s understanding of the limbo in which this leaves the Telegraph’s journalists and readers. We all understand that there are commercial sensitivities and quasi-judicial processes that have to be respected here, but these add to the sense of frustration that is experienced by potential buyers, vendors, Parliament and the public alike. Do the Government have any plans, when this is finally resolved, to look again at the Enterprise Act regime that governs it, to ensure that we have protections in place for our media, but also so that we can send a clear signal that the UK is open to investment from potential businesses?
Baroness Twycross (Lab)
The UK is most certainly open for investment. It is probably premature for me to do a review of a sale that has not yet taken place, but I assure your Lordships’ House that any lessons that can be learned from what has happened over the past year or so will be.
Lord Inglewood (CB)
My Lords, in response to the noble Lord, Lord Parkinson, the Minister said that it was premature to look into this unless and until the sale took place. Surely part of this sorry story—the “will she, won’t she?”—relates to the pre-sale process, and that is something that should be looked at just as much as what has happened after any hypothetical sale that may or may not occur.
Baroness Twycross (Lab)
The noble Lord makes a fair comment, and I will pass on his comments to the Secretary of State.
Lord Sikka (Lab)
My Lords, can the Minister explain some contradictions here? On the one hand, the Government are quite keen that a foreign Government should not own a UK newspaper, while being simultaneously content for foreign Governments, including dictatorships, to own UK water, energy, rail, ports, airports, oil, gas, hospitals, care homes, GP surgeries and more. Why this hypocrisy about foreign Governments that is just applicable to newspapers?
Baroness Twycross (Lab)
My noble friend is allowing me to explain why we want a pluralistic free press. It is fundamental to our democracy. I think that there is a difference between foreign investment in other parts of the UK economy, including utilities, and the free press that is a fundamental cornerstone of our democracy, and which we want to continue without foreign state interference.
Lord Wallace of Saltaire (LD)
My Lords, the Government are actively concerned about balance in the broadcast media. Are they also concerned about the maintenance of balance in the written media?
Baroness Twycross (Lab)
We would love to have a bit more balance in the written media. However, I am absolutely committed, as is the Secretary of State, to continuing to see the Telegraph remain as one of the key newspapers among a whole host of newspapers with centuries-old traditions.
Baroness Stowell of Beeston (Con)
My Lords, as no one else is seeking to ask a question, may I just return to this? The Minister seems to be suggesting in her answers that the Telegraph’s future remains in the destiny or hands of RedBird IMI, which has been found to be non-compliant with the law that Parliament has passed. Can I press the Minister again on the question that I asked? She suggested that they were not indicating that they would do something to transfer the debt, but surely the law prevents them from doing what has been reported and sounds so horrific in relation to this poison pill?
Baroness Twycross (Lab)
Unfortunately, I can only repeat the response that I gave previously. It is not my understanding that the Telegraph will be responsible for the debt. I will clarify to the noble Baroness in writing the extent to which that is because of the law or the extent to which it is because of the commitment, but we are absolutely clear that the Telegraph is not responsible for the debt.