The naming of a new CEO at DirecTV Group Inc could signal it's time for a takeover bid for the satellite TV company.

Some observers think the appointment of PepsiCo Inc veteran Michael White, who has no experience in pay TV, is a sign DirecTV parent Liberty Media Corp wants a baby-sitter before a sale in the next couple of years.

Representatives from Verizon Communications Inc and AT&T Inc have already each approached Liberty, controlled by John Malone, in the last year to express interest, according to people with knowledge of the talks. The discussions fizzled out on regulatory concerns and no talks are now taking place, they said on condition of anonymity.

Liberty, AT&T, Verizon and DirecTV all declined to comment.

Either telco would see DirecTV as a viable acquisition candidate, said Standard & Poor's equity analyst Tuna Amobi, adding that all pay-TV players are seeking scale. My sense right now is that John Malone will be open to selling at the right price.

Liberty Media shareholders are set to vote on Thursday to approve a plan to split DirecTV from Liberty Entertainment -- a move that Wall Street believes could pave the way for a telephone company to put in a bid for DirecTV, leading to a similar bid for smaller rival Dish Network Corp.

Both AT&T and Verizon are already marketing partners with DirecTV, offering a bundle of phone, Internet and TV services. But one advantage of owning a satellite TV company would be cost savings and more leverage in program negotiations with cable TV networks. Programing is by far the largest operating expense of running a pay-TV business.

DirecTV has some 18 million customers, while DISH has around 13.5 million. Verizon has spent billions of dollars building its FiOS video service, but only has 2.7 million customers, while AT&T's investment in Uverse has so far attracted 1.8 million customers.

Any deal under discussion would likely see DirecTV spin off its Latin America business as both U.S. phone companies are focused on domestic markets, analysts said.

REGULATIONS

But regulatory issues will dictate if a bid for either DirecTV or Dish Network is formally put on the table in the near term, observers said.

Talks of big mergers in media and telecommunications have generally been put on ice as companies wait to see how antitrust officials in Washington treat Comcast Corp's bid for controlling stake in NBC Universal.

NBC Universal's parents General Electric Co and Vivendi SA are still negotiating the terms of the NBC Universal deal, but agreement is expected soon.

The Comcast deal could easily make a bid for DirecTV or Dish less likely, said Craig Moffett, a cable and telecoms analyst at Bernstein Research.

The regulatory climate in Washington is going to be even more anti-media consolidation once the Comcast-NBC deal is on the docket.

One question is whether regulators would allow a phone company to offer satellite TV services in markets they already have their own video offering.

The big block might be whether the regulators let it through. It's a big deal, Chris Watts, an analyst at Atlantic Equities, said of a DirecTV takeover. It may be a pretty bitter pill for regulators to swallow at this stage.

MINIMIZING TAXES

For Liberty, the key to a transaction with Malone is minimizing his tax bill, analysts say.

The split shareholders are set to approve on Thursday will see DirecTV effectively buy Liberty Entertainment to become independent, so Liberty Media does not get taxed on a future sale of the satellite company if it is a stock-for-stock deal.

Liberty became a controlling holder of DirecTV last year when it swapped a minority stake in Rupert Murdoch's News Corp for its stake in the satellite TV operator.

Liberty Media Chief Executive Greg Maffei has said divesting DirecTV gives it more strategic options.

Any deal will have to wait at least a few months as White does not take the helm at DirecTV until January 1. He will succeed Chase Carey, who returned to News Corp earlier this year.

(Reporting by Yinka Adegoke and Sinead Carew; additional reporting by Jui Chakravorty; editing by Tiffany Wu and Andre Grenon)

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