Credit Rating Agencies Issue Warning Over Daily Mail's Telegraph Takeover Bid
The parent company of the Daily Mail, Rothermere Continuation Holdings Ltd (RCHL), has been put on credit watch by US credit ratings agency S&P Global Ratings. The move comes as RCHL seeks to finalize its £500m takeover bid for the Telegraph titles.
Analysts have expressed concerns over how RCHL will fund the deal, citing limited headroom under its existing long-term issuer credit rating. With the Telegraph group valued at £500m, RCHL's modest size and scale may lead to an increase in adjusted leverage beyond acceptable levels.
The £500m valuation of the Telegraph titles is significantly higher than expected by many observers, with some speculating that foreign state investment could still play a role in funding the deal. However, DMGT has stated that it must comply with foreign state influence rules, limiting its options for foreign investors.
RCHL's financial performance has shown resilience, with £1.1bn in revenues and adjusted pre-tax profits of £78m reported for the year to September 2024. The company's businesses include a consumer media arm generating £613m in revenue, a property information division reporting £219m in revenue, and an events arm seeing revenues increase by 67% year-on-year.
To simplify its structure, DMGT recently announced a reorganization into RCHL, a new parent company controlled by Lord Rothermere's discretionary trust. This move has raised questions about the company's financial health and ability to execute the Telegraph takeover bid.
The credit watch placed on RCHL highlights the risks associated with its high-profile bid for the Telegraph titles. Analysts will be closely monitoring the situation as it unfolds, with S&P Global Ratings' warning underscoring the need for caution among investors.
The parent company of the Daily Mail, Rothermere Continuation Holdings Ltd (RCHL), has been put on credit watch by US credit ratings agency S&P Global Ratings. The move comes as RCHL seeks to finalize its £500m takeover bid for the Telegraph titles.
Analysts have expressed concerns over how RCHL will fund the deal, citing limited headroom under its existing long-term issuer credit rating. With the Telegraph group valued at £500m, RCHL's modest size and scale may lead to an increase in adjusted leverage beyond acceptable levels.
The £500m valuation of the Telegraph titles is significantly higher than expected by many observers, with some speculating that foreign state investment could still play a role in funding the deal. However, DMGT has stated that it must comply with foreign state influence rules, limiting its options for foreign investors.
RCHL's financial performance has shown resilience, with £1.1bn in revenues and adjusted pre-tax profits of £78m reported for the year to September 2024. The company's businesses include a consumer media arm generating £613m in revenue, a property information division reporting £219m in revenue, and an events arm seeing revenues increase by 67% year-on-year.
To simplify its structure, DMGT recently announced a reorganization into RCHL, a new parent company controlled by Lord Rothermere's discretionary trust. This move has raised questions about the company's financial health and ability to execute the Telegraph takeover bid.
The credit watch placed on RCHL highlights the risks associated with its high-profile bid for the Telegraph titles. Analysts will be closely monitoring the situation as it unfolds, with S&P Global Ratings' warning underscoring the need for caution among investors.
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. I mean, £500m is a lot of money and their financial performance has been solid, right? They've got some great businesses under their belt - the consumer media arm and property info division are killing it 
. Credit watch or not, I'm still rooting for RCHL to make this takeover bid happen 
.
. Like, how's he gonna make it work? And what's up with this credit watch anyway? It's like they're saying "good luck, mate" before sending you down the drain 
, but I guess we'll have to wait and see how this all plays out 
. One thing's for sure, it's gonna be a wild ride! 
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Who needs a stable economy when you've got a big takeover deal to chase? Credit watch is just a fancy way of saying 'RCHL's got some major financial baggage 
! Rothermere Continuation Holdings Ltd (RCHL) gets put on credit watch by S&P Global Ratings and now everyone's wondering if they're gonna be able to pull off that £500m takeover bid for the Telegraph titles 
. The thing is, their financials are actually pretty solid, with £1.1bn in revenues and adjusted pre-tax profits of £78m reported for 2024 
. Anyway, I'd say keep an eye on this situation, guys. S&P Global Ratings' warning is not to be taken lightly 
.
Like, I'm no financial expert, but even I can see that RCHL's credit watch is a major red flag 
i hope DMGT can navigate this without sacrificing too much control or putting themselves at risk 
, especially considering RCHL's limited financial headroom 
I don't think this is a huge deal... like, yeah RCHL's got some financial worries and all but credit watch? That's just business as usual, right?