Liberty Media Expected to Buy 25% of Charter Communications

Liberty Media

is reportedly in talks with Charter Communications

to acquire 25 percent of the firm.

According to

, the deal would be worth nearly $2.5 billion. If this report proves to be true, it will be Liberty Media's first major acquisition since it spun off Starz

last year. In 2008, Charter was the

in America. The company has continued to grow, rising from 3.3 million subscribers to four million subscribers as of March 2012. Despite its growth, The Wall Street Journal said that it is now the eighth biggest pay-TV provider. Shares of Charter are up more than seven percent today. The company has been growing steadily over the last three months, rising 21 percent. Starz has performed even better, rising more than 58 percent since December. The stock is currently down less than one percent. Liberty Media has not been performing nearly as well. The stock has gained less than two percent over the last three months. It is currently trading down roughly one percent. Analysts have had a relatively positive outlook on Charter. Earlier today, ISI Group

on Charter from $88 to $100.

and

recently raised price targets as well. Last fall Charter faced a battle with one of its content partners, CBS

, after the network threatened to pull its channels from the cable provider. The two companies

and announced a new agreement in January. Under the new terms, Charter will now be able to stream online content from CBS and Showtime. By acquiring a stake in Charter, Liberty Media chairman John Malone will gain a piece of his own heritage. Before Liberty Media, Malone controlled Tele-Communications, Inc. TCI was once the largest cable provider in the United States. The firm was

to AT&T in 1998 -- several years after a

with Bell Atlantic fell apart. In 2001, Charter

from AT&T

. Thus, by acquiring a piece of Charter, Malone stands to gain access to some of the technology he lost.