Hollinger in takeover crisis

THE auction for Hollinger International has put the group's future in doubt as several bidders are understood to have pitched only for the Telegraph newspaper titles.

Without that jewel in the crown, Hollinger could be left struggling to restructure and create a credible business plan.

And it is now more likely that, despite assurances from the group that last night's bid deadline was final, the sale may go to a third round.

Sources suggest bids for the Telegraph newspapers on their own have come in at between £495m and £700m.

Several bidders expressed confusion over what assets were for sale. Lazard Brothers, the investment bank led by Bruce Wasserstein and which is handling the transaction, will now discuss the bids with the Hollinger board.

'It was a tortuous process,' a source close to one bidder said. 'No one is exactly sure where it goes from here.'

Axel Springer, the German publisher appears to have bid just e740m (£497m) for Hollinger UK publications only, including the Spectator magazine.

Springer had expressed interest in the entire group, which apart from the Telegraph titles includes the Chicago Sun-Times and the Jerusalem Post. It had mulled an offer, with partners, for the complete set of Hollinger titles, thought to have been worth about e1bn.

Those partners appear to have dropped out now and Springer has narrowed the focus of its bid to the British titles.

It appears Kohlberg Kravis Roberts (KKR), the US buyout group, has pulled out of the race because the wife of Henry Kravis, one of the founders, was a member of the Hollinger board during the period of a series of controversial payments that triggered the crisis leading to the company's sale. She may now face legal action over her role.

Other bidders for the Telegraph include the Daily Mail and General Trust, owner of the Daily Mail, the Mail on Sunday, the Evening Standard and This Is Money, the Barclay brothers, venture capitalist 3i, and a joint offer from buyout specialists Candover Investments and Apax.

Ex-Hollinger International chairman and chief executive Lord Black, facing a flurry of lawsuits with the firm, also believes the sale process will go to a third round, describing it in today's Times as like 'chasing a dancing football'.

'Bid 'em Up Bruce' at helm

VETERAN Wall Street dealmaker Bruce Wasserstein, the man ultimately charged with orchestrating the sale of Hollinger International and its titles, is known for extracting a heavy toll from buyers.

Dubbed 'Bid 'em Up Bruce' for his ability to fetch top dollar for his clients, he is best known for helping to structure Kohlberg Kravis Roberts' 1989 leveraged buyout of RJR Nabisco, later the subject of the book Barbarians at the Gate.

He sold his own investment bank to Dresdner Kleinwort Benson in September 2000. It was in turn bought by German giant Allianz but Wasserstein left after a promised flotation of DKW was scrapped. He became chief executive of Lazards soon after.