A cozy rendezvous on a super-yacht, a restaurant critics allegations of anti-Semitism and mutiny at The Guardian over the sale of the worlds oldest Sunday newspaper

The Left-leaning Guardian newspaper is renowned for its high-mindedness, as well as for its conviction that it is more virtuous than the rest of us.

On the whole, it looks down on Tories. Its not very keen on capitalism, despite sitting on a cash mountain worth a whopping £1.3billion. This huge sum is the result of canny investments first made over 40 years ago.

Yet the Guardian Media Group (GMG) is adept at losing money.

In most years over the past two decades it has shed tens of millions of pounds. Losses in the year to March were £36.5million.

This is the background to an almighty row involving a luxury yacht, an alleged sweetheart deal and hundreds of angry journalists threatening what would be the first strike at the newspaper for over 50 years.

GMGs bosses want to get rid of the Observer, the venerable Sunday newspaper it acquired in 1993, which is historically less stridently Left-wing than the Guardian.

Journalists on both papers are questioning the need for the sale, since the Observer officially makes a modest amount of money, its profit in its most recent financial year being £3.4million.

More than that, many of them are highly sceptical about the intended purchaser of the Observer – a small, loss-making and obscure company called Tortoise Media, which they doubt has the financial resources or know-how to run the Sunday title.

Shemara (pictured) is not strictly a yacht since it is powered by two Rolls-Royce engines

BBC Director of News and Current Affairs, James Harding walks outside the Midland Hotel on the first day of the Conservative Party annual conference in 2017 

Pictured: Guardian Media Groups (GMG) chief executive, Anna Bateson

To say that staff at the remarkably swanky headquarters of the Guardian and the Observer in Londons Kings Cross are seething with rage would be an understatement. Some have suggested that Katharine Viner, editor-in-chief of both newspapers, may have to resign. A similar fate could await GMGs chief executive, Anna Bateson.

This is where the luxury yacht comes in.

Shemara is not strictly a yacht since it is powered by two Rolls-Royce engines. Built in 1938, she was refurbished in 2014, and belongs to the telecoms magnifico, Sir Charles Dunstone. The boat can accommodate 12 guests in six cabins, attended by a crew of 16.

It was in 2017 that the aforementioned Anna Bateson, who was not then working for GMG, was a guest of Sir Charless on Shemara, along with her husband. Also present was an amiable and clever journalist called James Harding.

Harding was about to step down as director of news at the BBC, where he had been for three years, having previously been editor of the Times. After leaving the Beeb, he co-founded Tortoise Media, an online publisher, and became its editor.

There is nothing wrong about journalists holidaying on superyachts owned by multi-millionaires – although some would view such largesse as potentially compromising and therefore unwise. The point is only that Ms Bateson and James Harding are old friends. They have been in the same ski party in the French ski resort of Val dIsere.

Just over two months ago, journalists on the Guardian and Observer were flabbergasted to learn that GMG had entered exclusive negotiations with Tortoise Media to offload the Sunday newspaper. The news came out of the blue, one senior executive tells me. There was no warning.

A general view of the Guardian Newspaper offices on August 21, 2013 in London

Visitors walk through the lobby of the Kings Place development, which houses the editorial offices of the Guardian and Observer newspapers in 2014 

Staff were incredulous when they learned a few weeks later that Anna Bateson was a long-standing pal of the editor of the media company with which GMG was discussing the sale of the Observer.

Guardian Media Group subsequently declared that Ms Bateson had been candid during its deliberations about her friendship with Mr Harding.

All the same, many staff think it strange that a small company such as Tortoise Media, which has no track record whatsoever as a newspaper publisher, should have been given pole position in talks that were for a time secret, and remain exclusive.

When newspapers go up for sale, their owners usually seek to attract several bidders in order to get the best price. That is what is happening with the Daily Telegraph, which is still on the block, and it was the case with the Spectator magazine, recently sold for £100million.

GMGs behaviour seems particularly odd in view of the declared interest of another, so far unidentified, suitor in buying the Observer. Yesterday, it emerged that renewable energy tycoon Dale Vince is also circling the paper.

Why not invite as much interest as possible if you insist on selling the worlds oldest Sunday newspaper, first published in 1791, whose pages have been adorned by writers such as George Orwell and the brilliant theatre critic, Kenneth Tynan?

Journalists on the Guardian and Observer are up in arms about what many of them regard as a sweetheart deal, with more than nine in ten members of their National Union of Journalists chapel having voted for two 48-hour strikes, the first due to take place next Wednesday and Thursday.

Five former Observer editors plus Alan Rusbridger, an ex-editor-in-chief, have weighed in with a letter opposing the deal with Tortoise. More than 70 prominent cultural figures have signed a letter decrying the proposed sale as a betrayal of liberal journalism, which would be disastrous.

Signatories include writers Robert Harris and Michael Frayn (both of whom worked for the Observer), Right-leaning playwright Tom Stoppard, and actor Ralph Fiennes.

Five former Observer editors plus Alan Rusbridger (pictured), an ex-editor-in-chief, have weighed in with a letter opposing the deal with Tortoise

Ralph Fiennes attends the Conclave red carpet during the 19th Rome Film Festival at Auditorium Parco Della Musica on October 26

Are some of the journalists – and even their supporters – being a little precious? Possibly. One cant forget how Trumps recent election victory spurred editor-in-chief Katharine Viner to email her staff offering counselling after an extraordinary, devastating moment in the history of the United States. She evidently thinks they are sensitive souls.

It is also undoubtedly the case that other gripes lurk behind the threatened strike. A document produced by journalists openly admits as much, citing left-over anger about the pay deal, excessive executive pay, standards of governance, the global strategy, the mediocre quality of [the] senior editorial group... amongst other things.

Nor should we ignore Jay Rayner, who has just resigned from the Observer after 25 years as its restaurant critic. Rayner, who is Jewish, accuses the Guardian of employing anti-Semites, and Katharine Viner of lacking the courage to take them on.

All in all, the Guardian doesnt seem a very happy place. There has been endless agonising about slavery after it was discovered that the papers early 19th-century founder, John Edward Taylor, had tenuous links with the slave trade.

The paper has also been torn apart by arguments over trans rights. Two prominent female journalists have left in recent years, after accusing it, and by implication Ms Viner, of censoring discussions about gender identity.

Katharine Viner, it should be said, has turned out to be more woke and more Left-wing in her nearly ten years at the helm than her serpentine predecessor, Alan Rusbridger.

The row over the Observer is the latest episode in a collective nervous breakdown. Theres no denying that some of the journalists opposed to the sale to Tortoise sound a bit hysterical. But the fact remains that they are largely in the right.

They cite a front-page article in the Guardian after it had bought the Observer. Hugo Young, the then chairman of the Scott Trust which oversees the GMG, was quoted as saying: The Trusts safeguards will be fully extended to the Observer, which will be edited independently of the Guardian, and retain its separate character.

The undertaking that the Observer would enjoy the same rights and protection as the Guardian was reiterated by Carolyn McCall, chief executive of GMG, more than a decade later.

Journalists are also justified in questioning the ability of Tortoise Media to run a Sunday newspaper. In its short life, the tiny company has never made a profit, though it claims now to be breaking even. In 2022, the most recent year for which it has filed figures, it reported losses of £4.6million.

An arrangement of Guardian newspapers is photographed in an office in London on January 26, 2016

Not even the biggest publishers with the deepest pockets would contemplate running a stand-alone Sunday title in the modern age since the costs of such an operation are too high and the prospective revenues too meagre.

Yet Harding, who is admittedly an experienced and knowledgeable journalist, believes he can succeed with a paper that is selling less than a quarter of what it did at the beginning of the century. He has pledged to invest £25million in it over the next five years.

One plausible theory is that he intends to turn the Observer into a news magazine with smaller overheads than a newspaper, perhaps similar in format to the American publication Atlantic Monthly. Yet this has struggled to make a profit in recent years even after building up a large online readership.

Journalists on the Guardian and Observer are asking: why take the risk? GMG has £1.3billion in the bank. One can argue about whether the Observer is really making a small amount of money or whether, once its share of GMGs persistent losses are taken into account, it may be losing a little.

In any event, the sums are minuscule. The question is: Why does GMG wish to break historic undertakings, antagonise its staff, and damage its reputation won by getting rid of a newspaper that adds lustre to the group and isnt causing it any discernible trouble? It is mystifying.

Ironically enough, GMG doesnt appear to have much faith in its own strategy since, according to a report in the Financial Times, it might undertake to buy back the Observer if it fails under its new ownership. This doesnt imply enormous confidence in James Hardings plan.

Last week, the board of Guardian Media Group is believed to have agreed in principle that the sale of the Observer to Tortoise should go ahead subject to the final approval of the Scott Trust.

This august 12-person body met five days ago. It is chaired by Norwegian businessman Ole Jacob Sunde, who has a background in publishing. Katharine Viner is a member, though Anna Bateson is not.

Another member is David Olusoga, the academic and television presenter, who has been the mainspring of the Guardians angst about its tangential historic links with slavery. Some journalists are concerned that Olusoga has appeared numerous times with James Harding at events organised by Tortoise Media.

Mondays meeting of the Scott Trust lasted longer than usual and didnt rubberstamp the deal approved by GMG. Clearly members of the Trust are alive to the reputational damage that the sale to Tortoise would entail. A further meeting is expected imminently.

One political consideration is that if the Scott Trust were to go against the board of GMG and reject the sale, that would put Katharine Viner and Anna Bateson in an extremely awkward position. They would surely have to resign.

The Scott Trust is the custodian of the Guardians soul. And the Guardian, as we know, loves to occupy the moral high ground, where it is quick to chastise the shabby compromises and expedient arrangements of lesser mortals.

Will the Scott Trust respect its undertakings and defend the Observer, as it is honour bound to do? Or will it side with its executives and their sweetheart deal, and consign the worlds oldest Sunday newspaper to probable oblivion?