A ruling is not expected before next year, giving the parties time to seek a compromise. One of the sources said Mediaset may consider dropping its multi-billion euro damages claims if a solution emerged that fostered the group's development. Mediaset had planned to fold its domestic and Spanish businesses into the Dutch vehicle, and eventually pursue a closer tie-up with Germany's ProSiebenSat.1, in which Mediaset owns a 24.2% stake. The prospect of a potential breakthrough lifted Mediaset's stock which was up 3.2% by 1506 GMT against a 0.7% rise in Italy's All-share index. Mediaset Espana shares were also up 3%, while shares in ProSieben gained as much as 7% on Tuesday after Italian daily Il Messaggero reported that a potential deal may entail Mediaset raising its stake in the German group, which has so far shunned the prospect of closer integration. Both Mediaset and Vivendi declined to comment.