Billionaires add Telegraph to portfolio
They announced the signing of an "irrevocable agreement" with Ravelston, owned by Lord Black of Crossharbour, to buy its 78% stake in the Canadian company.
The deal was agreed in New York on Saturday night with ownership of Hollinger Inc transferring to Press Holdings International (PHI) owned by Sir David and Sir Frederick Barclay.
It also gives them 73% of voting rights in Hollinger International, which owns the Telegraph Group in Britain, the Chicago Sun-Times and the Jerusalem Post.
PHI has sent a letter to the directors of Hollinger International outlining reasons for the takeover, which include an improved ability to renegotiate debt.
Substantial cost savings would be achieved in distribution, printing, and advertising across the newspaper titles of the enlarged group. The company also cites negative publicity surrounding a US investigation into payments to Hollinger International executives, including Lord Black, who denies any wrongdoing.
Sir David said: "we believe this continued media controversy is significantly harming the public image and stock price of Hollinger International and undermining its credibility in the financial markets.
"As part of the acquisition, the negative media attention should cease."
The Barclay brothers own a number of newspapers in Britain, including The Scotsman; Edinburgh Evening News; Scotland on Sunday and The Business.
They also own the Ritz hotel in London and retail businesses, including Littlewoods and the Index Catalogue stores.
Under takeover rules, PHI must make an offer to minority shareholders in Hollinger Inc for the remaining 22% shares.
It must also satisfy regulators that the deal does not breach competition regulations.
The company is hopeful that the takeover can be completed by the end of February.
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