Dixons Retail, the owner of Currys and PC World, has announced it is in talks to merge with Carphone Warehouse.
The news follows Mobile's revelation earlier this month that Carphone Warehouse was in high level talks with Dixons.
The electronics giant said the talks were at a very early stage and there could be no certainty a merger would take place.
In a statement it said that the two companies 'are in preliminary discussions regarding a possible merger of Dixons and Carphone Warehouse.
'These discussions are at a very preliminary stage and there can be no certainty that a transaction will be forthcoming. No decision has been reached regarding the structuring of any such merger.'
A Carphone Warehouse spokesperson said: 'We can confirm we are in preliminary discussions with Dixons Retail Group about a possible merger of our businesses. To be clear, these are very early discussions and we will provide further updates when it is appropriate to do so.'
Both companies have until 24 March to announce their intentions.
Dixons operates more than 500 Currys and PC World stores in the UK and Irish Republic.
Carphone Warehouse operates more than 2,000 stores across Europe.