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In a brief statement EMI said that Warner has yet to submit a concrete proposal, nor is there any certainty that this approach will lead to an offer being made.

The two companies have been carrying on a will-they won't-they relationship since the turn of the century. Previous merger talks in 2000 and 2003 broke down, while both

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companies were said to be considering bids for the other last year.

But with the European Union having blocked the merger of Sony and BMG, pending an appeal, it is unlikely to rubber stamp a deal between two of the other major record companies. If both deals were permitted, what was once five companies, the other being Vivendi's Universal Music, would become just three.

EMI has already issued two profit warnings this year, as a result of weak sales over the Christmas period coupled with a overall decline in the music market. This may go some way to explain its apparent enthusiasm for DRM-free music downloads, something Warner CEO Edgar Bronfman has said is 'without logic and merit'.