In a statement issued this morning, Trinity Mirror confirmed it is attempting to buy out the 80pc of shares in Local World that it does not already own.
It read: “The Board of Trinity Mirror plc notes the recent media speculation and confirms that it is in discussions with Local World Holdings Limited for the potential acquisition of the shares not already owned by Trinity Mirror plc. There is no certainty that any agreement will be reached.
“A further announcement will be made if and when appropriate.”
A merger between Trinity and Local World would create by far the biggest regional newspaper company in the UK with a publishing footprint covering 15 of the top 25 centres of population in England and Wales.
Trinity Mirror already owns the main daily newspaper titles in Birmingham, Manchester, Liverpool, Cardiff, Coventry and Newcastle. Control of Local World would enable it to add Bristol, Nottingham, Leicester, Hull, Plymouth, Stoke, Derby and Swansea to that list.
DMGT, which previously owned Northcliffe, remains the biggest shareholder with a 38.7pc stake, while Iliffe parent company Yattendon plc owns 21.3pc. The other shareholdings are split between a variety of investors.
At the time Local World was created, the company was valued at around £70m, with Trinity Mirror paying £14.2m for its 20pc stake.
Reports at the weekend suggested the Trinity deal could be worth £200m, which would give both DMGT and Iliffe a sizeable return on their original investment.
Speculation about a tie-up between the two companies has been rife since May when reports of a takeover deal first emerged.
At the time, both companies declined to comment on the rumours, and it was later reported that the talks had foundered amid opposition from Yattendon boss Lord Iliffe.
With little overlap between the two companies’ existing publishing footprints, it is believed that any regulatory obstacles to a merger could be overcome.
Trinity Mirror has already recouped its £14.2m investment in Local World with its 20pc share generating dividends in excess of £15m over the past two years.