Judge's ruling gives go-ahead for Telegraph sale

The sale of the Daily and Sunday Telegraph newspapers is expected to be sealed today.

It follows a failed bid by newspaper baron Conrad Black to challenge the deal with the Barclay brothers.

A court in the US yesterday threw out Black’s motion to hold up the transaction so that it could be subjected to a shareholder vote.

The newspapers’ parent company, the US media group Hollinger International, announced last month that it had accepted a £665m (€1bn) offer from the Barclays for the Telegraph titles.

Black stepped down as chairman and chief executive of Hollinger International last year amid a scandal over payments to Black and his associates that shareholders said were unauthorised.

He is the main subject of a $1.25bn (€1bn) lawsuit from Hollinger International, which claims he used the newspaper as “a cow to be milked” of cash.

However, Black retains voting control over Hollinger International through a Canadian holding company called Hollinger Inc, which holds a 68% voting interest in the group through a special class of supervoting shares.

A shareholder vote would have given Lord Black an effective veto over the sale of the Telegraph titles to the Barclays.

But in a strongly-worded ruling, Judge Leo Strine of the Delaware Chancery Court threw out Black’s argument that the Telegraph made up “substantially all” of Hollinger International’s assets and therefore would have triggered a shareholder vote.

In a statement, Hollinger International welcomed the ruling and said it expects the deal to be closed today.

Gordon Paris, the company’s interim chairman and CEO, said: “We are extremely pleased with Vice Chancellor Strine’s ruling. The agreement to sell the Telegraph Group was the outcome of a thorough and exhaustive evaluation of strategic alternatives available to the company and its shareholders.

“We are now in a position to complete this transaction and deliver on our promise to create value for all of our shareholders.”

Jeremy Deedes, chief executive of the Telegraph Group, also welcomed the ruling, which he described as “unequivocal”.

“This is clearly very good news from the Telegraph Group’s point of view,” he said. “It means that the sale can be completed in the morning.

“I very much hope for the sake of everybody that it does proceed. This has gone on long enough.”