Scripps deal could be as soon as July

Negotiations to acquire media company Scripps Networks Interactive Inc. are advanced and a deal could be announced as soon as this month, people familiar with the matter said.

Both Discovery Communications Inc. and Viacom Inc. are vying to buy Scripps, and are likely to fund the deal with a mixture of cash and shares, the people said, asking not to be identified as the details aren't public. No final decisions have been made and talks may still fall apart, they said.

Buying Scripps could help the larger media companies cut costs, gain negotiating leverage with distributors and expand internationally as their U.S. TV businesses faces new pressures. Network owners are grappling with a decline in subscriptions for cable and satellite services as they lose viewers to online video services and social networks.

The company has been considered a potential target for several years, since the family trust that controlled Scripps was dissolved in 2012.

Still, ironing out control issues for a combined company could be a hurdle to a deal. The Scripps family still controls the company's voting stock, while John Malone owns about 94 percent of Discovery's Class B shares, which have 10 times the voting power of the Silver Spring, Md.-based company's Class A shares. Sumner Redstone's National Amusements Inc. controls Viacom.

Malone recently was able to reach a compromise on a similar transaction when he merged his Starz with Lions Gate Entertainment Corp. Mark Rachesky, who owned about 20 percent of Lions Gate, diluted some of his control of the combined company but became the largest holder of Class A shares.

It's not the first time Discovery and Scripps have considered a deal. Discovery took a look at Scripps back in late 2013, and analysts long have speculated that the company, whose networks include the Discovery Channel, might revisit the idea of a merger with the owner of the Travel Channel.

Scripps's lifestyle programming could be attractive to Discovery or Viacom if they opt to introduce an online offering, letting consumers pay directly for streaming video as they do today for services such as Hulu. Discovery, Viacom and AMC Networks Inc. have been considering services that might cater to people who don't want to pay for big cable packages with lots of sports, people familiar with the matter said in April.

There's some skepticism, though, that a deal would have many benefits.

'We don't see how a combination with SNI (Scripps) makes sense,” Marci Ryvicker, analyst at Wells Fargo Securities, wrote in a note to clients about a potential deal with Discovery. 'We also view SNI as being in a really unique leadership position when it comes to its demographic. And we don't think the Scripps Family is going to give up control.”