Last month, troubled cable operator Telewest, SMG's second biggest shareholder, announced it wanted to sell its stake in the Scottish group in a bid to reduce its debts and strengthen its balance sheet.
When the sale of the stake was announced a month ago, it was suggested that the stake would go to a trade buyer, rather than flooding the stock market with £60m worth of SMG shares.
ITV companies Granada and Carlton Communications have also been in talks with SMG. Both are reported to be interested in acquiring SMG's ITV franchises.
However, if Granada bought the stake it would be forced, under stock market rules, to make a bid for the whole company. This would fall foul of current media ownership rules. Carlton is believed to have balked at the price of the stake.
Telewest's decision to sell its stake in SMG came at an inconvenient time for the Scottish company because SMG had put its ITV assets up for sale the previous month to help wipe out its £380m debt.
SMG put a price tag of £480m on the assets, which comprise the Scottish and Grampian ITV franchises. Talks with Carlton and Granada have so far come to nothing.
Now it is believed that SMG chief executive Andrew Flanagan is formulating a new structure of the business that would revolve around the company keeping its TV operations. However, this would not help its financial position.
It is now expected that if the company sells any part of its business it would be its Scottish operations, which includes Glasgow-based daily newspaper The Herald. It would retain its UK media businesses including Virgin Radio.
The company is set to announce its half-year results this week, with pre-tax profits expected to meet analysts' expectations that it is on track to meet full-year forecasts of pre-tax profits of £32m.
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