LONDON — Speculation is mounting in the U.K. that a £350 million ($587 million) joint bid by cabler Discovery Communications and Rupert Murdoch’s satcaster BSkyB for British free-TV broadcaster Channel 5 is likely to be successful.

A deal was agreed in principle last week, U.K. trade magazine Broadcast claimed Monday. Under that deal, Discovery would take a 70% stake and BSkyB would nab the remaining 30%. BSkyB would add Channel 5’s advertising inventory to its own sales operation.

Channel 5’s owner Northern & Shell denied a deal had been inked. “We have a number of bids as expected, which we will evaluate with our advisers over the next few days. Certainly no deal has been done,” a spokesperson said.

Other bidders are thought to include Viacom and Nordic TV group Modern Times Group. Northern & Shell had initially sought more than £700 million ($1.18 billion) for Channel 5.

Northern & Shell, which is owned by media mogul Richard Desmond, bought Channel 5 from RTL Group for £104 million ($174 million) three years ago, and has embarked on a ruthless cost-cutting exercise. The network airs a broad range of Hollywood series and movies.