By Manuel Baigorri, Matthew Campbell and Alex Sherman
(Bloomberg) — Vodafone Group Plc and Liberty Global Plc are discussing a range of potential transactions, including an outright merger, amid consolidation in the telecommunications industry, people with knowledge of the matter said.

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The talks are informal and at a very early stage, and an agreement may not be reached because of the complexity of the proposed transactions and regulatory concerns, said the people, asking not to be identified because the deliberations are private. Management issues, including who would run the combined company and the role of billionaire Liberty Global Chairman John Malone, are also a hurdle, two people said.
Other options under discussion include a merger of the companies’ European businesses as well as a series of asset swaps, the people said. A merger of the two companies would be one of the largest deals ever based on enterprise value, with Liberty Global currently at about $89 billion and Vodafone closer to $141 billion. Liberty has soured slightly on the talks in recent weeks, said one of the people.
Representatives for Newbury, England-based Vodafone and London-based Liberty Global declined to comment. Liberty Global jumped as much as 6.2 percent in late trading.
The possible structure of a deal between Vodafone and Liberty Global has been evolving since late last year. While buying Liberty outright was Vodafone Chief Executive Officer Vittorio Colao’s original idea, more recently his goal has shifted into acquiring that company’s western European assets, one of the people familiar with the matter said.
As part of a merger of the companies’ European assets, Vodafone would likely explore a spinoff of its operations in the Middle East and Africa, one of the people said.