The beauty parade has begun for the Ten Network, with executives from US media giant Discovery Communications meeting with the struggling free-to-air broadcaster.
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Talks began on Tuesday afternoon, after Fairfax Media revealed last week that Discovery was considering a joint bid for Ten with local pay TV monopoly Foxtel.
The third-ranked metropolitan commercial network will also brief US hedge fund Anchorage Capital and private equity firm Hellman & Friedman.
Discovery's meeting with Ten came as the broadcaster's shares snapped a week of gains, falling 1.8 per cent to 27c on Tuesday.
The company's stock had soared almost 28 per cent in the days after it confirmed last Thursday that it had appointed Citi to assess "strategic options".
But any acquirer is set to face a big hurdle after the network's biggest shareholder, WIN Corporation owner Bruce Gordon, said on Monday afternoon that his 14.9 per cent stake was not for sale.
A successful bidder would need the Bermuda-based billionaire's support to secure 90.1 per cent of shareholder acceptances, which is necessary to trigger a compulsory acquisition of all stock.
Seven West Media deputy chairman Don Voelte said Ten – which posted a $168 million loss last financial year – could survive in its current form but there were "issues around cash flow".
"There is something to be said for three [commercial free-to-air channels]," Mr Voelte said in Sydney.
He said that was a question for Ten's biggest shareholders – Mr Gordon, News Corporation co-chairman Lachlan Murdoch, Crown Entertainment chairman James Packer and mining magnate Gina Rinehart – who control about 40 per cent of the company.
"I suspect they'll decide whether it gets sold or not or whether it forms part of private equity ... there are so many gyrations," Mr Voelte said.
Discovery – a $US22 bullion ($25 billion) company that launched in 1985 with the Discovery Channel – has been buying free-to-air television networks across the globe.
It has already made acquisitions in Denmark, Sweden, Norway, Italy and the Middle East, has started a free-to-air channel, Quest, in Britain and has majority control of .
Its bid would involve Foxtel, which is jointly owned by Rupert Murdoch's News Corp and Telstra, taking a 14.9 per cent stake in the company in order to meet laws restricting concentration of ownership.
Analysts say some of Discovery's popular content aired on Foxtel's channels could be screened on Ten. Meanwhile, Foxtel could bring knowledge of the local market and cross-marketing opportunities through News Corp's print and digital titles.
Time Warner is also interested Ten. It said in a letter to Ten's adviser Citi last month that it was willing to explore a bid of 25c a share.
"We believe that Ten can once again regain its position as one of the leading channels in the Australian market," Time Warner senior vice-president James Burtson wrote in a letter to Citi that was leaked to The Australian Financial Review on Monday. Time Warner met with Ten on September 18.
