Senior executives at AT&T Inc and Time Warner Inc have met in recent weeks to discuss various business strategies including a possible merger, according to people familiar with the matter.
The talks, which at this stage are informal, have focused on building relations between the companies rather than establishing the terms of a specific transaction, the people said, asking not to be identified as the deliberations are private. Neither side has yet hired a financial adviser, the people said.
Acquiring Time Warner would give AT&T, one of the biggest providers of pay-TV and of wireless and home internet service in the United States, a collection of popular programing to offer to subscribers, from HBO to NBA basketball to the Cartoon Network.
AT&T CEO Randall Stephenson has been looking to add more content and original programing as part of his plan to transform the Dallas-based telecommunications company into a media and entertainment giant.
"There's a lot that's attractive about Time Warner," media industry veteran Peter Chernin, who runs an online video joint venture with AT&T, said in an interview on Thursday on CNBC. "I think they're both great companies." He said he didn't know anything about a deal.
Time Warner Chief Executive Officer Jeff Bewkes is a willing seller if he gets an offer he thinks is fair, said one of the people.
Bewkes and his board rejected an -a-share approach in 2014 from Rupert Murdoch's 21st Century Fox Inc, which valued Time Warner at more than billion.