Internet retail giant Amazon is circling Lovefilm in a deal that could value the movie rental service at nearly £200 million, it has been reported.
The books-to-electronic-goods retailer is understood to be carrying out due diligence on the business that is expected to lead to a buyout offer being made during the next few months, according to the Sunday Times.
Takeover talks are understood to have gathered pace when Lovefilm started to consider a stock market flotation.
Amazon already holds a 42% stake in Lovefilm following a tie-up with its European film rental business in 2008. Other shareholders include technology backers Arts Alliance and Index Ventures.
Lovefilm has more than 1.4 million members across Europe. In exchange for a monthly fee, users can select films and games from the group’s library of 70,000 titles.
Films are either posted to users or they can be downloaded electronically.
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