Rupert Murdoch's News Corp has indicated it will make a "substantial cash offer" for media conglomerate Pearson's Penguin Group, joining the race for the book publisher, the Sunday Times reported.
In an unsourced report, the paper said the bid could total around 1 billion pounds ($1.6 billion) and could scupper plans to tie Penguin with Random House, owned by Germany's Bertelsmann. News Corp owns book publisher HarperCollins.
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The paper said HarperCollins and Penguin together would have a market share of 20 percent, while a tie-up of Penguin with Random House would control nearly 30 percent of English-language book sales.
Pearson confirmed on Thursday that it was in talks with Bertelsmann, Europe's biggest media group, but said the two had yet to agree a deal.
Outgoing Pearson Chief Executive Marjorie Scardino was thought to favor a deal with Random House, while other executives wanted to open talks with News Corp, the paper said.
A sale would provide a clean break with book publishing for Pearson, also owner of the Financial Times, as it concentrates on the education division that became a dominant force under Scardino.
A News Corp spokeswoman declined to comment on the report. Pearson spokesmen could not immediately be reached for comment.
($1=0.6212 British pounds)
(Reporting by Clara Ferreira-Marques; Editing by Mike Nesbit)