Richard Desmond, the publisher of the Express titles, has instructed his financial advisers at Seymour Pierce to put together a bid for The Telegraph as expressions of interest flooded in for the assets of Hollinger International, the media group that owns the newspaper.
Daily Mail & General Trust is understood to also be among "a mass of parties" that have already approached Lazard, the investment bank charged on Monday with examining "strategic alternatives" for Hollinger International, the operating company controlled by Lord Black of Crossharbour that owns The Daily Telegraph, The Sunday Telegraph and the Chicago Sun-Times.
A "data room" will be made available in the next few days for bidders to examine the books of Hollinger and its assets. The Telegraph titles are thought to be worth up to £500m.
While many potential bidders said they were not sure which assets were now up for sale and over what time frame, Mr Desmond is understood to have pressed ahead. Seymour Pierce, the financial adviser that worked on Mr Desmond's £125m acquisition of Express Newspapers three years ago, is putting together an offer.
Lord Black remained in combative mood yesterday, telling reporters at a book store in Toronto, where he was promoting his biography of Franklin Roosevelt: "I made 50 million bucks yesterday. That's a flame-out I could get used to," referring to the rise in Hollinger's share price. "Who do you think turned The Daily Telegraph and the Chicago Sun-Times from insolvent properties to market leaders? What do you think did that? Corporate governance?" he said.
The Desmond camp was stressing the fact that it can move quickly and flagging up its obvious advantage over other bidders - it owns half the Telegraph's print works. It has been suggested that Mr Desmond could also make life awkward for other buyers because of his hold over the print facilities, where the Telegraph has a contract to be printed until 2009.
Responding to suggestions that Rupert Murdoch may seek to get involved, Les Hinton, the chairman of News International, said: "We have no interest in it."
News International, the owner of The Times and The Sun, has some 32 per cent of the UK national newspaper market, while DMGT, publisher of the Daily Mail, has about 18 per cent. DMGT will argue that it should not be prevented from buying the Telegraph titles, which have an 8 per cent market share, as it would still have less of the national industry than News International. A rival claimed that if DMGT bought the Telegraph titles, it would have the same number of ABC1 readers as News International.
An industry source said: "These are pretty dark waters but DMGT would want to get in there, if only to jack up the price for Desmond."