The German media industry is abuzz with speculation that two of the nation’s leading newspaper giants may be about to merge, as rumour has it that WAZ Mediengruppe is plotting a hostile takeover of Axel Springer.

The basis of WAZ’s mooted manoeuvre is the 40.33% stake in Springer held by media mogul Leo Kirch. Talks between the two are said to be advanced, with close to €1 billion ($0.98bn; £0.64bn) reportedly on the table.

WAZ may also be looking to buy shares held by Ariane and Sven Springer, capitalising on their desire to prevent leading shareholder Friede Springer from taking control of the group.

However, a deal could lead to years of legal action. Springer’s management board has the right to block the transfer of the voting rights attached to the Kirch-owned shares, but Kirch believes this veto can be circumvented by selling the whole of his Print-Beteiligungsgesellschaft unit (the division that holds the stake) to WAZ. Springer has vowed to fight any such move in court.

Another obstacle is time, as Kirch needs the cash to repay a €720 million loan from Deutsche Bank. The Springer stake was used to secure this loan, and if Kirch does not find the money by September 10, the bank will claim ownership of the shares.

Should all such hurdles be successfully cleared and a merger completed, the result would be a publishing colossus boasting €5bn in annual sales and a 30% share of Germany’s newspaper market.

Data sourced from: multiple sources; additional content by WARC staff