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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to complete the deal, with potential lenders including Oaktree Capital Management and Hudson Bay Capital said to have withdrawn from the process.

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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.

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IMF upgrades UK economic growth forecast – but issues tariffs warning

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IMF upgrades UK economic growth forecast - but issues tariffs warning

The UK economy will grow more than previously thought, according to the International Monetary Fund (IMF), which has upgraded its latest forecast.

It also said the Bank of England should “continue to ease monetary policy gradually”, indicating it expected further reductions in interest rates.

But it warned trade tensions linked to US tariff plans will reduce UK economic growth next year.

The Washington-based UN financial agency said the UK economy will expand 1.2% this year and “gain momentum next year”.

The upgrade in forecasts, however, is slight, up from an expected 1.1% announced in April as the world reeled from the global trade war sparked by US President Donald Trump’s tariffs.

That April figure was a 0.5% downgrade from the projected 1.6% growth for 2025 the IMF foresaw in January and the 1.5% forecast issued in October.

It means the IMF expects the UK economy to grow less this year than it forecast in October and January.

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Tariffs warnings

This anticipated lower growth is largely due to tariffs – taxes on goods imported to the United States – and the uncertainty caused by shifting trade policy in the US, the world’s largest economy.

While many tariffs have been paused until 8 July, it’s unclear if deals will be in place by then and if pauses may be extended.

The effect of this has been quantified as a 0.3 percentage points lower growth by 2026 in the UK, the IMF said.

The organisation held its prediction that the UK economy will grow by 1.4% in 2026.

“The forecast assumes that global trade tensions lower the level of UK GDP by 0.3% by 2026, due to persistent uncertainty, slower activity in UK trading partners, and the direct impact of remaining US tariffs on the UK,” it said.

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Trump’s tariffs: What you need to know

It comes despite the UK having agreed a deal with the Trump administration to circumvent the 25% tariffs on cars and metals.

The IMF also cautioned that “weak productivity continues to weigh on medium-term growth prospects”.

Lower productivity has been an issue since the global financial crash of 2008-2009, but has been caused by “chronic under-investment”, low private sector research and development, limited access to finance for businesses to expand, skill gaps, and a “deterioration in health outcomes”, it said.

Interest rates

Interest rates “should” continue to come down, making borrowing cheaper, though the IMF acknowledged rate-setters at the Bank of England now have a “more complex” job due to the recent rise in inflation and “fragile” growth.

The author of the report on the UK, Luc Eyraud, said the IMF expected the Bank to cut interest rates by 0.25 percentage points every three months until they reach a level of around 3%, down from the current 4.25%.

Praise was given to the UK government as the IMF said “fiscal plans strike a good balance between supporting growth and safeguarding fiscal sustainability”.

“After a slowdown in the second half of 2024, an economic recovery is under way,” the IMF said.

Global factors – “weaker export performance in the challenging global environment” – are blamed for the slowdown last year.

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The news is being taken as a win by Chancellor Rachel Reeves.

“The UK was the fastest growing economy in the G7 for the first three months of this year and today the IMF has upgraded our growth forecast,” she said.

“We’re getting results for working people through our plan for change – with three new trade deals protecting jobs, boosting investment and cutting prices, a pay rise for three million workers through the national living wage, and wages beating inflation by £1,000 over the past year.”

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What is the two-child benefit cap and will Labour scrap it?

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What is the two-child benefit cap and will Labour scrap it?

The government is considering getting rid of the two-child benefit cap first brought in by the Conservatives.

The policy has caused considerable consternation within the Labour Party, with a growing number of MPs calling to scrap it and ministers so far refusing to.

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But now, Education Secretary Bridget Phillipson has given the government’s strongest hint yet it may scrap the cap after she told Sky News ministers are “considering” lifting it.

We look at what the cap is and the controversy over it.

What is the two-child benefit cap?

Since 2017, parents have only been able to claim child tax credit and universal credit for their first two children, if they were born after April 2017.

An exception is made for children born as a result of rape.

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Child benefit reform ‘not off the table’

Who introduced it?

Then work and pensions secretary Iain Duncan Smith first proposed the policy in 2012 under the Conservative-Liberal Democrat coalition government.

It was not until 2015 that then chancellor George Osborne announced a cap would be introduced from the 2017/2018 financial year.

The coalition said it made the system fairer for taxpayers and ensured households on benefits faced the same financial choices around having children as those not on benefits.

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David Cameron on the 2015 campaign trail
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David Cameron’s government introduced the cap, though he was out of office by the time it came in

What is Labour’s position on the cap?

The party has long been divided over the issue, with Sir Keir Starmer ruling out scrapping the cap in 2023.

He then said Labour wanted to remove it, but only when fiscal conditions allowed.

Following Labour’s landslide victory last July, the prime minister refused to bow to pressure within his party, and suspended seven MPs for six months for voting with the SNP to scrap the cap.

Ministers have toed the party line for months, but the narrative started to shift in May, with Sir Keir reported to have asked the Treasury to see how scrapping it could be funded.

The publication of Labour’s child poverty strategy was delayed from the spring to autumn, fuelling speculation the government wants to use the next budget to scrap the cap.

Then the education secretary told Sky News on 27 May lifting the cap is “not off the table” – and “it’s certainly something that we’re considering”.

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Why did Labour delay their child poverty strategy?

How many children does the cap affect?

Government figures show one in nine children (1.6m) are impacted by the two-child limit.

In the first three months Labour were in power, 10,000 children were pulled into poverty by the cap, the Child Poverty Action Group found.

In May, it said another 109 children are pulled into poverty each day by the limit, adding to the 4.5 million already in poverty.

The Resolution Foundation said the cap would increase the number of children in poverty to 4.8 million by the next election in 2029-30.

Torsten Bell, the foundation’s former chief executive and now a Labour Treasury minister, said scrapping the cap would lift 470,000 children out of poverty.

Torsten Bell.
Pic: Dimitris Legakis/Athena Pictures/Shutterstock
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Torsten Bell has warned against keeping the cap. Pic: Dimitris Legakis/Athena Pictures/Shutterstock

How much would lifting the cap cost the taxpayer?

The cap means for every subsequent child after the first two, families cannot claim benefits worth £3,455 a year, according to the Institute for Government.

It estimates removing the limit would cost the government about £3.4bn a year – equal to roughly 3% of the total working-age benefit budget.

It is also approximately the same cost as freezing fuel duties for the next parliament.

Research has found the indirect fiscal impacts of lifting the cap could be higher, as some data shows investing in young children can pay for itself by causing better outcomes for them later in life.

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Donald Trump says he will postpone 50% tariffs on EU until July

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Donald Trump says he will postpone 50% tariffs on EU until July

Donald Trump says he will delay the imposition of 50% tariffs on goods entering the United States from the European Union until July, as the two sides attempt to negotiate a trade deal.

It comes after the president of the European Commission, Ursula von der Leyen, said in a post on social media site X that she had spoken to Mr Trump and expressed that they needed until 9 July to “reach a good deal”.

The US president had last Friday threatened to bring in the 50% tariffs from 1 June, as European leaders said they were ready to respond with their own measures.

But Mr Trump has now said that date has been put back to 9 July to allow more time for negotiations with the 27-member bloc, with the phone call appearing to smooth over tensions for now at least.

Speaking on Sunday before boarding Air Force One for Washington DC, Mr Trump told reporters that he had spoken to Ms Von der Leyen and she “wants to get down to serious negotiations” and she vowed to “rapidly get together and see if we can work something out”.

The US president, in comments on his Truth Social platform, had reignited fears last Friday of a trade war between the two powers when he said talks were “going nowhere” and the bloc was “very difficult to deal with”.

Mr Trump told the media in Morristown, New Jersey, on Sunday that Ms Von der Leyen “just called me… and she asked for an extension in the June 1st date. And she said she wants to get down to serious negotiation”.

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“We had a very nice call and I agreed to move it. I believe July 9th would be the date. That was the date she requested. She said we will rapidly get together and see if we can work something out,” the US president added.

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Shortly after, he wrote on Truth Social: “I agreed to the extension – July 9, 2025 – It was my privilege to do so.”

On his so-called “liberation day” last month, Mr Trump unleashed tariffs on many of America’s trade partners. But since then he’s backed down in a spiralling tit-for-tat tariff face-off with China, and struck a deal with the UK.

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Much of his most incendiary rhetoric on trade has been directed at Brussels, though, even going as far as to claim the EU was created to rip the US off.

Responding to his 50% tariff threat, EU trade chief Maros Sefcovic said: “EU-US trade is unmatched and must be guided by mutual respect, not threats.

“We stand ready to defend our interests.”

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