Virgin Mobile, which is 72% owned by Sir Richard Branson and 28% publicly traded, rejected an offer of 323p per share or £817m last month, forcing NTL to increase its offer for the company to around 360p per share.
It is understood that the board of Virgin Mobile is hoping for an offer of 400p per share, but may be prepared to meet somewhere in the middle.
NTL, which recently merged with smaller rival Telewest, has ambitious plans to take on Sky by rebranding as Virgin Media and offering mobile calls as well as TV, broadband and fixed-line calls.
Merger talks were instigated by former NTL chief executive Simon Duffy nine months ago, and in December Virgin Mobile revealed to the stock market that it has received an approach from the cable giant.
If the deal goes ahead Branson would become the single largest shareholder in the new enlarged company, which is likely to be valued at £4.5bn, by swapping his Virgin Mobile shareholding for a stake of around 14%.
Seperately, the Office of Fair Trading has cleared the £6bn merger between NTL and Telewest, and Sky's £211m takeover of video on demand company Easynet.
Sky is being tipped to make more acquisitions with HomeChoice also tipped as a possible purchase.
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