Tortoise Media has signed a deal to acquire The Observer from the Guardian Media Group (GMG) and The Scott Trust.

Under the deal, Tortoise will invest £25m and combine its digital newsroom with The Observer’s, adding "significant new editorial resources" to the paper, while also building a daily digital Observer that includes podcasts, video, newsletters and a new website.

Under the deal, which has been struck in cash and shares, there will be a five-year commercial agreement with GMG, in which Tortoise will pay for both print and distribution services, as well as marketing through The Guardian.

The first edition of The Observer under the new ownership is set to be published in the spring, with the current acting editor becoming print editor, while editor and founder at Tortoise, James Harding, will serve as editor-in-chief.

The Scott Trust has also been acquired by Tortoise and comes away from the deal with a 9% stake in the firm.

It will also take a seat on Tortoise’s commercial board, chaired by former US ambassador to the UK, Matthew Barzun, and on its editorial board, which is chaired by former editor of the Financial Times, Sir Richard Lambert.

The deal comes after four days of strike action taken over the sale, with staff at both The Observer and The Guardian stating their concern over the financial future of the newspaper.

Harding said: "The Observer has a historic place in the world of journalism and a special place in the heart of its readers. We’re excited to put all we have into making sure its values, interests and passions reach even more people in the many years to come. We respect the fact that people have had different views on the best way forward for The Observer. We all share a passionate belief in its future and the privilege of working for it."

Barzun concluded: "This process revealed the enormous regard and passionate connection so many have to the world’s oldest Sunday newspaper. I am deeply appreciative of our investor partners, including the Scott Trust, all of whom expect the highest quality independent journalism. We are filled with an awesome sense of responsibility as we become a part of its long story and participants in sharing the stories it will long keep telling."

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