The former chancellor Nadhim Zahawi is in line to become chair of the Daily Telegraph and the Sunday Telegraph after brokering a deal between Middle Eastern investors and the Barclay family, according to reports. The Barclays are thought to be attempting to regain control of the media group with financial support from investors in the United Arab Emirates, months after surrendering the debt-laden business to Lloyds Banking Group. Lloyds put the Telegraph’s holding company into receivership in June after the breakdown of talks with the family. On Thursday, the Times reported that Zahawi had been involved as a “middle man” in the financing deal, raising the prospect of the Conservative MP becoming chair of the titles if the Barclays were successful in buying back about £1bn of debt owed to Lloyds. Such a move would probably prove controversial as Zahawi was sacked as the Tory party chair in January after he was found to have breached the ministerial code by failing to declare an HMRC investigation into his tax affairs. An inquiry by the prime minister’s ethics adviser, Sir Laurie Magnus, concluded that Zahawi had made a “serious breach” of the code by not telling officials he was under investigation by the tax body when he was appointed chancellor by Boris Johnson. He remains the member of parliament for Stratford-on-Avon. The proposed tie up between Zahawi and the Barclays is understood to involve investment from anonymous backers based in Abu Dhabi. Under their proposals, the Barclays and their co-investors would settle about £1bn of debts owed to Lloyds at a discount – reportedly by paying up to £600m. While this would represent a discount on the amount owed to Lloyds, the bank has previously written down the value of the debt, meaning the offer would allow for a significant write-back – an increase in the paper value of the debt. Lloyds is understood to be keen to press ahead with an auction process run by Goldman Sachs that is expected to begin this autumn. The chief executive of Lloyds, Charlie Nunn, said last month he did not want to enter into a “rushed sale”. A spokesperson for the Barclay family did not comment. Neither the Telegraph nor Zahawi responded to efforts to contact them.