Liberty Global is in talks with Sunrise Communications Group about a potential partnership to combine and expand their businesses in Switzerland, according to Reuters.

The early-stage discussions could pave the way for a joint venture between Liberty’s UPC unit and Zurich-based Sunrise, which has a market value of about $4.2 billion. The combined business’s structure could mirror the deal that billionaire John Malone engineered two years ago for Liberty Global, his European cable-TV company, with Vodafone in the Netherlands, the report said.

The companies are working with advisers as they evaluate strategic options, the people said. The two sides may not reach an agreement, they said. Sunrise shares fell by the most in more than a year on the Bloomberg News report, reflecting investors’ disappointment that Liberty isn’t discussing an outright acquisition of Sunrise.

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