Waterstones is in exclusive talks to buy Blinkbox books, The Bookseller understands.
Tesco is in exclusive talks with one buyer, thought to be Waterstones, with a deal expected to be finalised by the end of this week. The bookseller urgently needs a digital app-based proposition to rival competitors such as Amazon and Blinkbox books would supply that.
The deal, if done, raises questions about Waterstones' stocking of Amazon's Kindle e-readers and tablets.
Meanwhile the company has delayed the re-launch of its website several times, with the last delay coming at the end of December. Any purchase of Blinkbox books would need to be integrated with the buyer's website.
Tesco, Blinkbox and Waterstones have all declined to comment.
However James Daunt, Waterstones m.d, is quoted by the Financial Times saying that Waterstones currently sells e-books in a "very inefficient and poor manner" and that with the rising popularity of tablets, Waterstones needs a platform for e-book sales that works on all devices.
Blinkbox movies has been sold to TalkTalk, reportedly for between £25-30m, and Blinkbox Music has been sold to Australian music company Guvera for an undisclosed sum.
Tesco bought Mobcast from Tony Lynch and Andy McNab in September 2012 for £4.5m and was rebranded under the Blinkbox brand. The e-book platform launched in March last year.