Springer quits Hollinger bid battle

GERMAN publisher Axel Springer has withdrawn from the bidding battle for Hollinger International's Daily Telegraph newspaper in the UK.

Although Springer is prepared to offer about £550m for the Telegraph, Hollinger is believed to want more than £600m.

Springer‘s withdrawal had been rumoured for several days but the company has now let it be known that it is prepared to re-enter negotiations only if Hollinger lowerS its price.

Reports, however, say that the company‘s supervisory board in Germany was concerned that it would have over-extended itself at the higher price.

It is understood that there was also concern about how British readers of the Telegraph would react if it had German owners.

The issue was highlighted by the row over a foul-mouthed tirade launched by Express newspapers' publisher Richard Desmond during a meeting with senior Telegraph executives last month.

Desmond is alleged to have mocked the Springer takeover as akin to being owned by 'Nazis', according to the Telegraph executives involved in the meeting.

Several bidders remain in the frame for the Telegraph, including Daily Mail & General Trust, owners of The Daily Mail, the Mail on Sunday, the Evening Standard and This Is Money. Others include the Barclay Brothers, who already own The Scotsman and The Business newspapers, as well as private equity groups Apax and Candover.

The Telegraph titles are being sold by Hollinger International, assisted by merchant bank Lazard.

US buyout firm Kohlberg Kravis Roberts was also known to be interested in acquiring Hollinger, whose other newspaper titles include the Chicago Sun-Times and Jerusalem Post.

Analysts expect Lazard to meet Hollinger's board later this week to agree whether whether the company should be sold as a whole or whether it should go ahead with just a sale of the Telegraph titles.

At least two offers are believed to have made for the Chicago Sun-Times, including one by a bid vehicle headed by Yusef Jackson, son of the Democrat politician Jesse Jackson.