AOL Time Warner is shaping up for a battle with US media tycoon John Malone for control of NTL, the debt-laden cable company.
It is understood that Richard Parsons, chief executive designate of the US internet and media group, has held informal discussions with NTL's chief executive, Barclay Knapp, over the last month. Mr Malone, who controls Liberty Media, has held similar talks.
But sources close to NTL say only one new major equity investor will be brought into the company, raising the possibility of what would be one of the biggest corporate battles in years.
The winner will be the party that can offer Mr Knapp the most attractive package of new equity, with plans to take on some of NTL's £12bn in debt. Mr Parsons, who takes over from Gerald Levin in May, wants to realise AOL Time Warner's ambition to break into the European cable market to distribute its media content.
Mr Parsons said last week: "We have a keen interest in that market place. We are looking for ways in which to create a kind of vertical alignment."
But Mr Malone hasn't hidden his interest in NTL. He controls 44 per cent of Liberty Media, which in turn owns 25 per cent of Telewest, opening up a possible NTL-Telewest merger.
Mr Malone has one extra string to his bow. Through Liberty, he also owns 4 per cent of AOL Time Warner.
He plans to apply to the Federal Trade Commission for full voting rights at the company.Reuse content