Warner, which had a previous bid rejected earlier this year, was given until Thursday by British regulators to decide whether to make a move.

EMI is backing a £2.4bn offer led by investment firm Terra Firma but reports suggest another bid may still emerge.

Plagued by worsening sales, EMI hopes a takeover will give it new impetus.

Warner said it reserved the right to reconsider its position should EMI receive another bid besides the Terra Firma offer.

Former EMI chief executive Jim Fifield has been linked with a bid for EMI and he has until Thursday to clarify his position.

Terra Firma said EMI shareholders now have until 29 July to decide whether to accept its 265p-per-share offer.

The UK equity firm said that 26.19% of EMI investors had so far accepted the offer - up from 3.82% a week ago.

The increase in uptake came as Warner Music ruled out making another attempt to buy EMI, reducing the prospect of a bidding war.

However, Warner did say that it reserved the right to reconsider its position should EMI receive another bid besides the Terra Firma offer.

Terra Firma's bid for EMI values the company at £3.2bn (£1.6bn) including debt.

EMI's artists include Joss stone, Lily Allen, Coldplay, Gomez and The Magic Numbers.

Ninety percent of EMI shareholders agreed to the £2.4bn takeover offer by the UK company, controlled by buyout specialist Guy Hands.

This means the remaining shareholders are now obliged to accept the 265p-per-share offer.

EMI's artists include Joss Stone, Lily Allen, Coldplay, Robbie Williams and the Chemical Brothers.

Rival bid

The bid had been repeatedly extended, but eventually shareholders were given until 1300 BST on Wednesday to decide.

EMI had also attracted interest from Warner Music, which had a previous bid rejected earlier this year.

The board of EMI first agreed to be bought by Terra Firma on 21 May.

One of the world's big four record companies, EMI has seen sales decline dramatically over the past year.

In May, it said that it had made a £260m loss in its latest financial year.

Like all record companies, it has been hit by the trend for more digital downloading of music, while a number of high-profile album releases have badly disappointed.

EMI announced a radical restructuring plan earlier this year, resulting in the loss of hundreds of jobs in both Europe and the US.

The restructuring plans come from EMI's private equity owner Guy Hands, who bought the firm for £3.2bn last year.

The record industry has been trying to cut costs as it faces falling CD sales and a switch to internet downloads.

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