More Liberty/DIRECTV Dealing on Horizon?

What could be next for DIRECTV and Liberty Media? How about more dealing from John Malone's company for a bigger stake in the small dish service?

On Friday, Jason Bazinet of Citi Investment Research said Liberty could tender for DIRECTV in an all-stock offer. The analyst's suggestion came along with an initiation of coverage of Liberty shares with a "buy" rating and $33 price target.

In a note, Bazinet cited several reasons for a possible Liberty tender for DIRECTV: The company already has a large stake in DIRECTV, amounting to about 48 percent, and the recent private purchase of DIRECTV shares, among other factors.

"The April 2008 private purchase of 78 million DIRECTV shares suggests Dr. Malone wants a larger piece of the DBS apple," Bazinet said. "Any share purchased today - at market prices - is a share that doesn't have to be purchase at a premium down the road."

And the Citi analyst said he saw three future scenarios involving DIRECTV and Liberty: All DIRECTV holders accept Liberty's tender offer (which Bazinet characterized as unlikely); Enough DIRECTV shareholders accept tender offer to push Liberty's stake above 50.1 percent (which the analyst said could likely happen); or the companies keep intact the status quo (which Bazinet said he doesn't expect to occur).

Whatever happens, the matter is hard to ignore. As Bazinet pointed out, Liberty's biggest asset is its stake in DIRECTV.