EMI eyes up Warner prize: EMI confirms that talks are in progress with Time Warner over $1.5bn buyout of Warner Music.(Mergers)

EMI and Time Warner are expecting a speedy resolution to their discussions about a potential $1.5bn-$1.6bn deal.

It is understood that last Monday's offer by EMI to buy Warner's recorded music division is likely to be either agreed or dropped within a matter of weeks.

The UK-headquartered major confirmed last Monday that it had made a bid to Time Warner for the recording division of Warner Music. The offer--which was tendered over the weekend--includes an offer of around $1bn in cash and $600,000 in the form of a 25% stake in the combined company.

In a statement issued to the London Stock Exchange last Monday, EMI said, "In view of speculation in the weekend press, EMI Group plc announces that it has now entered non-exclusive discussions with AOL Time Warner Inc, with regard to a possible transaction involving the recorded music division of the Warner Music Group.

"Discussions are at a very preliminary stage and there is no assurance that they will result in an agreement acceptable to both parties. Any potential transaction would be subject to shareholder and regulatory approval."

In a statement to staff last Monday, EMI Group chairman Eric Nicoli added, "At EMI, we are already making steady progress in our objective to be a strong, independent music group but we believe that we should explore every available opportunity that might help us towards that goal."

EMI moved quickly after a period of exclusive talks between Time Warner and BMG expired two weeks ago. It is understood that the company moved after making Time Warner aware of its interest in mounting a takeover and receiving encouragement in the company's response.