Telegraph takeover may be foiled

LORD Black is heading back to court in a last-ditch attempt to block the sale of the Daily Telegraph to the secretive Barclay brothers.

Sources say the ousted chairman of Hollinger International, the Telegraph's parent company, will appeal to US judge Leo Strine 'within days' for a shareholder vote on the £665m deal.

It is the largest sum ever paid for a British newspaper, but Black says it is not high enough.

He attacked the sale for valuing the Telegraph, Sunday Telegraph and Spectator magazine at almost exactly the same price as the Barclays did in their earlier offer for his controlling stake in Hollinger.

Black may be at the centre of an investigation for allegedly pocketing millions in unauthorised management fees and racketeering, but he still owns 73% of the group's voting rights and 30% of the equity.

He could technically halt the sale, which Hollinger insists does not have to be approved by investors.

'Hollinger International and its financial advisers assumed an obligation to deliver greater value for shareholders. Their faltering strategic process has failed to do so,' said Hollinger Inc, Black's holding company.

The Barclays are paying a hefty 29 times pre-tax profits of £23.3m, or around twice sales. But Steve Barber, head of media at Ernst & Young, reckons the price is fair.

'As a multiple of profits the price may appear enormous, but compared to revenues it is not outrageous' he said.

The Telegraph's 1,200 staff welcomed their new owners. Sir David Barclay's son Aidan is set to be Telegraph chairman.

Former Sunday Times editor Andrew Neil may have a consultancy role.

The Barclays need to negotiate with Express Newspapers over their joint ownership of the West Ferry printing plant, where Express may seek full control.

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