The Daily Telegraph reported the news over the weekend, citing unnamed sources.
TMG, which is jointly owned by London-based buyout house Apax Partners and Guardian newspaper publisher Guardian Media Group (GMG), has recently become the subject of a bidding war.
Apax has agreed £1.1bn of debt financing with Goldman Sachs, JP Morgan, Macquarie and Societe Generale to back a £751m bid for the half of the company it does not own, the report said.
But that offer would value TMG at £1.5bn, despite Apax telling its investors the business is worth £1.7bn to £1.8bn, resulting in a disagreement over price between the two sides, the report added.
Hellman & Friedman is understood to have approached Apax to buy out GMG’s interest, which would free up cash for GMG to support its newspaper titles, The Guardian and The Observer.
But GMG and Apax are said to have reached a stalemate, as Apax wants to buy GMG’s stake at what one source told The Daily Telegraph was a “knock-down” price.
Apax has blocked attempts by Hellaman & Friedman and other potential bidders – who are rumoured to include US buyout titan KKR and German media conglomerate Bauer – who have tried to partner with the firm and buy the GMG stake, the report added.
Apax bought a 49.9 per cent stake in the business in 2007, in a deal valuing the company at £1.35bn.
The company posted EBITDA of £142.9m for the year ending in March 2011, but has £600m of debt.
Reports last month said Apax had expressed an interest in buying the remaining half of TMG it does not already own, which flushed out interest from a number of private equity firms including KKR.
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