Telegraph suitors given five-week bid deadline

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The Independent Online

Lazard, the merchant bank handling the auction of Hollinger International's assets, has told bidders to make their final offers by the end of next month. It has accelerated the auction after last weekend's attempt by the Barclay brothers to seize control of the company, which owns the Telegraph newspaper titles.

If the Barclays succeed in buying holding company Hollinger Inc, they will inherit 73 per cent of Hollinger International's voting rights, enabling them to block any disposals. Lazard phoned bidders on Friday to reassure them that the sale process had not been derailed.

Collins Stewart, the stockbroker, is set to table an offer as early as this week for the Telegraph Group. But bidders said it would be tough to meet Lazard's new deadline. Daily Mail & General Trust, owner of the Daily Mail, contacted Lazard last week but does not want to be rushed into making an offer.

Financial buyers now hold the upper hand because they do not have the same competition issues as trade buyers, making a quick deal easier. Private equity group Candover is also expected to table a first-round bid in the coming days.

Talks are at a preliminary stage and detailed discussions about valuation with Lazard have not begun. The Telegraph Group could fetch more than £500m.

This week, the Barclay brothers will formally launch their conditional £260m offer for Hollinger Inc, which will trigger a 35-day sale timetable. Collins Stewart, which wants to make its first-round offer by the end of the first week of February, has earmarked the Telegraph Group for an "accelerated IPO", under which it would be floated on AIM, the junior stock market, immediately after acquisition. It has already received strong support from institutional investors looking to buy shares in the new company.

The broker introduced the novel concept last year when it trumped rival financial buyers with the acquisition and subsequent float of Northumbrian Water. It repeated the success with the more recent acquisition of Center Parcs.

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