Reports suggest that Rtl, which owns two-thirds of five, and United Business Media, which owns the other third, have indicated they would be satisfied with a share of around 40 per cent in the merged broadcaster.
Gerhard Zeiler, the Rtl chief executive, has been quoted as saying Rtl is prepared to own a minority position in a larger company because he believes both five and Channel 4 need to be bigger.
Zeiler is said to have met last month with Luke Johnson, Channel 4's chairman, and Andy Duncan, its chief executive. Talks are at an early stage and Zeiler is quoted as saying a decision on a deal will be taken by the end of the year.
However, Channel 4's £770 million turnover is close to three times that of five, raising questions about whether the 40 per cent share for five's shareholders is realistic.
Channel 4 is also exploring the option of working more closely with the BBC and has been linked with a potential bid for parts of its BBC Worldwide operation.