Ministers are being asked to intervene after RedBird IMI, an investment fund owned by Sheikh Mansour bin Zayed Al Nahyan, vice-president of the United Arab Emirates (UAE), reached a deal to purchase the broadsheet newspaper and The Spectator magazine.
In a letter coordinated by Neil O’Brien, who was a health minister until the reshuffle a fortnight ago, the 18 MPs said they believed that the proposed transaction “presents a very real potential national security threat”.
The backbenchers said ministers should not be “railroaded into clearing” the change of ownership and should instead “pause the deal” to review its impact on Britain’s security and press freedom.
They urged Oliver Dowden, who is Rishi Sunak’s deputy, to conduct a review of the transaction linked to Sheik Mansour, who owns Manchester City football club, by using powers under the National Security and Investment Act (NSI).
RedBird IMI is a joint venture between US firm RedBird Capital and International Media Investments (IMI) of Abu Dhabi.
It said this month that it had reached a deal with previous owners the Barclay family. The deal would see debts the Barclays owed to Lloyds repaid, the fund said.
Culture Secretary Lucy Frazer said last week she was “minded” to open an investigation into whether the deal was against the public interest, and the effect it may have on the ability to report freely.
The Department for Culture, Media and Sport said she was still considering whether to issue a Public Interest Intervention Notice (PIIN).
The letter's signatories also include Foreign Affairs Select Committee chairwoman Alicia Kearns and former Tory Party leader Sir Iain Duncan Smith,
In the letter it says that UAE funding deals have come under scrutiny in the US recently, due to the country’s “increasingly close relations with China”.
The MPs said the “influence” that the Telegraph sale would give to a “foreign government that is strengthening its relationship with Beijing at a time of growing tensions is even more troubling”.
Highlighting human rights charity Amnesty International’s concerns over the “serious implications” for media freedom if the deal goes ahead, the MPs said the sale could “imperil these publications’ ability to report freely, which clearly poses a national security risk”.
They told Mr Dowden: “We therefore think that, in addition to the sensible steps already taken, now is the time for the government to announce that it will use its powers under the National Security and Investment Act to scrutinise this deal fully.
“Taking action under the NSI Act would not prejudice the bid and those involved in it.
“Instead, much like a Public Interest Intervention Notice, it would enable the government to gather the necessary information and examine the proposed transactions in detail.
“Lloyds Banking Group and the Barclay family have set an artificial deadline of completing the transaction this week, but they have been discussing this unpaid debt for years now.
“Rather than being railroaded into clearing a transaction by interested parties we believe that the Government should instead pause the deal and take its time to fully look into all the issues, from the impact on press freedom and journalistic standards in the UK, to the impact it would have on our national security.”
Other MPs to have signed the letter include Robert Courts, chairman of the Defence Select Committee, Sir Geoffrey Clifton-Brown, Richard Drax, Simon Fell, James Grundy, Sir John Hayes, Simon Jupp, Jonathan Lord, Craig Mackinlay, Jill Mortimer, John Redwood, Selaine Saxby, Alec Shelbrooke, Andrew Selous and Sir Desmond Swayne.
Officials in Mr Dowden’s Cabinet Office said they could not comment on whether the NSI Act could apply to the Telegraph acquisition.
They said, while the government welcomes foreign investment, ministers would not hesitate to use their powers to protect national security wherever concerns are identified.
When asked for a reply to the MPs’ letter, RedBird pointed to recent remarks made by head of the fund, Jeff Zucker.
The former head of US broadcaster CNN told The Telegraph on Tuesday that concerns over the takeover were “misplaced”.
“I am here to say that the editorial independence of The Telegraph is guaranteed,” Mr Zucker said.
Sir Brandon Lewis, a former justice secretary and ex-Tory Party chairman, took an opposing view to his colleagues and has rallied behind the deal.
In an article for the same newspaper, he urged MPs to “see through the horse-trading hyperbole that surrounds this deal”.
Referencing Mr Zucker’s past work with a “liberal” American news organisation, he said: “Does anyone actually believe that a company as successful as his is willing to pay eye-watering sums for some of the best-known and most-respected brands in journalism, only to wreck their investments by allowing any whiff of censorship to taint them?
“That would be unfathomably stupid business,” he added.
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