Sir Paul Marshall has not submitted a formal offer for the Telegraph despite being regarded as one of the favourites to assume ownership of the broadsheet.
The hedge fund and media magnate did not meet a deadline for offers on Friday night set by current owners RedBird IMI, according to The Sunday Times.
Sir Paul had joined forces with the US financier Ken Griffin in his attempt to secure the Telegraph newspapers, having been awarded the paper’s sister publication, The Spectator, earlier this month.
Marshall’s team remain interested in papers but were deterred by the £550m price tag set by Redbird IMI, which was barred from running the papers on account of its links with the Abu Dhabi royal family.
Marshall’s withdrawal will boost the chances of New York Sun owner Dovid Efune and UK publishing executive David Montgomery, both of whom are understood to have made bids as part of Friday’s deadline.
Montgomery runs London-listed National World, formerly JPI Media, which publishes some of the UK’s largest regional outlets, including The Scotsman, the Yorkshire Post and Belfast’s The News Letter.
The Sunday Times reported that Nadhim Zahawi could yet table a last-ditch bid for the newspapers, which comprise The Daily Telegraph and The Sunday Telegraph, after the Chancellor has been on the hunt for financial backing for his bid.
Marshall’s decision to pull out having been one of the frontrunners is the latest twist in what has been a dramatic and protracted bidding process.
The title’s ultimate ownership has been in the balance since the summer of 2023 when Lloyds Bank seized what was then the Telegraph Media Group from its owners, the Barclay family.
RedBird IMI – a joint venture between Sheikh Mansour bin Zayed al-Nayhan and the US investment shop Redbird Capital Partners – was originally awarded the paper having agreed to pay off the Barclay family’s £600m debts against the title.
But after the then Conservative government published new laws that blocked foreign states from owning newspapers in the UK, the UAE-backed consortium decided to put the papers back up for sale, appointing Robey Warshaw and Raine Group to run an auction process.
Since then several bidders have circled around the publication, with Efune and Montgomery the only two confirmed remaining. Private equity behemoth CVC, advertising mogul Lord Saatchi and the Daily Mail owner had at different stages all emerged as potential bidders before all pulling out for differing reasons.
A representative for Sir Paul Marshall declined to comment.