Barclays get Government's go-ahead for 'Telegraph' purchase

Ministers have waved through the Barclay brothers' proposed purchase of The Daily Telegraph, saying it did not raise"public interest" concerns.

Ministers have waved through the Barclay brothers' proposed purchase of The Daily Telegraph, saying it did not raise"public interest" concerns.

Press Holdings, the media company owned by Sir David and Sir Frederick Barclay, said yesterday they had been told by the Department of Trade and Industry that the Secretary of State, Patricia Hewitt, had decided not to intervene on public interest grounds. The twins still have to pass a final hurdle: an investigation, now under way, by the Office of Fair Trading into the competition issues raised by the £665m deal.

The actual transfer of ownership of theTelegraph titles to the Barclay brothers, from Hollinger International, has already taken place. But the Barclays would be forced to sell if the transaction failed the public interest or competition tests.

Regulatory experts said the clearance on public interest grounds was expected. It is also thought they face no significant competition issues as their national media interests are small. The public interest test allows the DTI to refer a proposed media deal for scrutiny by Ofcom, the media regulator, which can recommend a full public interest investigation by the Competition Commission. In this case, the DTI did not even seek Ofcom's views.

The public interest test looks at whether a proprietor has a history of editorial interference, whether the proprietor's newspapers accurately present news and, third, the effect of the deal on plurality of ownership. The Barclays do not have obvious cases to answer on any of the three parts of the test, regulatory experts said. It is known that Andrew Neil, the executive who runs the Barclays' existing papers does interfere editorially, but it is not clear that this is at the behest of the brothers.

Some of the titles' failed bidders would have raised much greater public interest concerns. The Daily Mail & General Trust would probably have been referred under plurality issues, while Richard Desmond's media company could have fallen foul on editorial interference.

Separately, media industry sources suggested that Rupert Murdoch's Times had signalled its intent to compete aggressively with The Telegraph's new owners by publishing a long front-page article linking the Barclay brothers to a banned Japanese commodity trader and a controversial Japanese politician.