The owner of the Daily Mail is lining up one of Britain’s biggest high street lenders to help bankroll its £500m deal to buy The Daily Telegraph.
Sky News has learnt that DMGT has turned to its long-standing bank, NatWest Group, to lend a substantial chunk of the Telegraph purchase price.
City sources said on Thursday that discussions between the two were still in progress.
It was unclear how much of the consideration NatWest might finance, or how much equity DMGT intended to put up as part of the deal.
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Last month’s announcement that DMGT was in exclusive talks to buy Telegraph Media Group achieved a long-standing ambition of the Mail proprietor, Lord Rothermere, to own the rival right-leaning newspaper.
However, the transaction still needs to be formally submitted to the culture secretary, Lisa Nandy, who has effectively asked for details of the proposed deal by early next week.
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Lengthy inquiries by the Competition and Markets Authority and Ofcom are also expected to follow.
DMGT’s exclusivity period came within days of a consortium led by RedBird Capital Partners abandoning its own deal amid opposition from within the Telegraph newsroom.
NatWest’s position as a principal lender would, in theory, be advantageous to Lord Rothermere, who will not want to be reliant on overseas financing for the deal.
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The DMGT owner had originally intended to acquire a minority stake of just under 10% in the Telegraph titles as part of the RedBird-led transaction.
A previous deal proposed by a consortium including RedBird and the Abu Dhabi state-owned investment firm IMI collapsed after the government changed the law regarding foreign state ownership of national newspapers.
“I have long admired the Daily Telegraph,” Lord Rothermere said last month.
“My family and I have an enduring love of newspapers and for the journalists who make them.
“The Daily Telegraph is Britain’s largest and best quality broadsheet newspaper, and I have grown up respecting it.
“It has a remarkable history and has played a vital role in shaping Britain’s national debate over many decades.”
If the deal is completed, it would bring the Telegraph newspapers under the same stable of ownership as titles including Metro, The i Paper and New Scientist.
DMGT said in November that it planned “to invest substantially in TMG with the aim of accelerating its international expansion”.
“It will focus particularly on the USA, where the Daily Mail is already successful, with established editorial and commercial operations.”
NatWest declined to comment.
