US private equity firms TPG Capital and Hellman & Friedman could lob formal bids for Fairfax Media within a fortnight.
It comes as the publisher confirmed it has received interest from John Singleton and Mark Carnegie for Fairfax's 54 per cent stake in Australian business Macquarie Radio, home of AM radio stations 3AW, 2GB and Alan Jones.
Both TPG and H&F began due diligence in Fairfax's data room in late May to go through the numbers for their bids.
Formal bids could be in by as soon as the end of June, however the American private equity firms may request extensions to continue working through Fairfax's books.
TPG and its consortium partner Ontario Teachers' Pension Plan have a $1.20 per share proposal for Fairfax, valuing the 186-year old publisher at A$2.7 billion (NZ$2.8 billion).
TPG upped its bid after widespread shareholder rejection of a proposal to buy Domain, the metropolitan publications – The Australian Financial Review, The Sydney Morning Herald and The Age – events and digital ventures, minus Stan, for 95c a share, leaving Fairfax shareholders with the company's radio assets, regional papers and New Zealand business.
Domain is the key asset both firms are after – both TPG and H&F have gone through management presentations with both Fairfax and Domain. Key questions included costs, earnings growth potential, synergies, further business opportunities, such as mortgages and insurance, flagged by Domain boss Antony Catalano in March.
Both TPG and H&F were said to be impressed by the presentations and are pushing ahead with due diligence – TPG's team working on the deal is more than 30 strong.
TPG is advised by Credit Suisse and Gilbert + Tobin, while Fairfax is advised by Macquarie Capital and Herbert Smith Freehills. Hellman & Friedman is working with King & Wood Mallesons.
Meanwhile, the publisher has confirmed Singleton and Carnegie wrote to Fairfax expressing interest in buying its Macquarie Radio stake. Carnegie, a former H&F advisor, is also advising the firm with its Fairfax bid in an unofficial capacity.
"We're in receipt of the letter," a Fairfax spokeswoman said.
Nine Entertainment has long been speculated as an interested buyer of Fairfax's radio assets.
Rival media sources questioned the seriousness of the bid from Singleton and Carnegie.
It's not the first time the pair have come sniffing around Fairfax.
In 2013, the pair reached a 'consultation agreement' with Fairfax's then largest shareholder, mining magnate Gina Rinehart, aimed at splitting up the media company.
In 2012, Singleton and Carnegie, who at the time owned the majority of Macquarie Radio, unsuccessfully bid for Fairfax's radio assets. Fairfax's radio assets eventually merged with Macquarie Radio in a A$200 million merger finalised in 2015.