One of the world's largest investment groups is in talks to help finance a £550m takeover of The Daily Telegraph by the owner of The New York Sun.
Sky News has learnt that Apollo Global Management, which oversees assets worth $733bn, has been holding initial talks with Dovid Efune and his advisers in recent days about lending part of the money required for the deal.
Banking sources said on Tuesday that the discussions were preliminary in nature and might not lead to an agreement.
Other debt providers are also in talks with Mr Efune, the sources added.
The development has emerged just three days before an exclusivity period for the US-based businessman expires, although insiders say it is almost certain to be extended.
Apollo ranks among the world's biggest financial institutions and is a major player in both private equity and private credit around the globe.
In the last fortnight, a string of media reports have cast doubt on Mr Efune's ability to complete the deal, with potential lenders including Oaktree Capital Management and Hudson Bay Capital said to have withdrawn from the process.
Sky News revealed at the start of November that the former Conservative chancellor Nadhim Zahawi and the party's former treasurer, Sir Mohamed Mansour, had been enlisted by Mr Efune to aid his bid for the right-leaning newspapers.
Mr Zahawi, who has been tipped for a peerage in Rishi Sunak's resignation honours list, and Sir Mohamed are expected to invest tens of millions of pounds in the deal if it goes ahead.
In September, Sky News revealed that Sir Mohamed had been approached to provide as much as £150m to a standalone bid for the Telegraph titles that were being spearheaded at the time by Mr Zahawi.
If completed, the transaction will crystallise an unlikely profit for RedBird IMI, the Abu Dhabi-backed vehicle which paid £600m to acquire a call option that was intended to convert into ownership of the Telegraph newspapers and The Spectator magazine.
Depending on the final structuring of the deal, it could be worth as much as £575m, with less than a third of that expected to be in the form of debt.
The Spectator was recently sold for £100m to Sir Paul Marshall, the hedge fund billionaire, who has installed Michael Gove, the former cabinet minister, as its editor.
Insiders said that Mr Zahawi was likely to be handed an ongoing role at the Telegraph if the bid from Mr Efune was successful.
The former chancellor, education secretary and vaccines minister has been involved in the Telegraph process in various guises, initially helping broker a deal with RedBird IMI before assembling his own offer.
He has close connections to many of the Gulf-based figures involved in the process, including Sultan Ahmed al Jaber, chairman of the bidding vehicle.
Mr Zahawi has also since been named chairman of Very Group, the online retailer owned by the Barclay family which controlled the Telegraph for two decades, and which is now part-funded by IMI.
The UAE-based IMI, which is controlled by the UAE's deputy prime minister and ultimate owner of Manchester City Football Club, Sheikh Mansour bin Zayed Al Nahyan, extended a further £600m to the Barclays to pay off a loan owed to Lloyds Banking Group, with the balance secured against other family assets.
Mr Efune's bid has raised the extraordinary possibility of a return to the British newspaper group for Conrad Black, its former proprietor, Sky News reported earlier in the autumn.
Other bidders for the Telegraph included National World, the London-listed vehicle headed by former Mirror newspapers chief David Montgomery, and Lord Saatchi, the former advertising mogul, who offered £350m.
Lord Rothermere, the Daily Mail proprietor, pulled out of the bidding earlier in the summer amid concerns that he would be blocked on competition grounds.
The Telegraph auction is being run by Raine Group and Robey Warshaw, the advisers to the Abu Dhabi-backed entity which was thwarted in its efforts to buy the media titles by a change in ownership law.
Apollo declined to comment.
(c) Sky News 2024: Apollo in talks to finance New York Sun-owner's £550m Telegraph bid
