STOCKS NEWS EUROPE-United Utilities rises on renewed bid talk
United Utilities rises to near the top of Britain's FTSE 100 benchmark index after British newspapers report renewed bid speculation surrounding the company.
The Daily Telegraph's stock market report cites speculation that a consortium of infrastructure funds featuring GIP, Ontario Teachers' Pension Plan and Borealis are lining up a bid worth between 8-10 billion pounds ($12.7-$15.9 billion) for United Utilities.
A spokeswoman for United Utilities says the company has no comment to make on the media reports.
United Utilities' shares are up 2.2 percent at 732 pence in early morning trade, jostling with consumer goods group Unilever for the top spot on the FTSE 100 leaderboard. At that price, United Utilities has a market capitalisation of roughly 5 billion pounds.
"This is just pure bid speculation again," says Securequity sales trader Jawaid Afsar.
Afsar says that while he does not see any takeover of United Utilities happening in the near-term, such a scenario is feasible, with many analysts expecting an increase in takeover deals this year as companies look to use cash that was saved up during the worst years of the global financial crisis.
"This is a very rumour driven market. People are out there looking at what the next target might be, and United Utilities has been singled out," says Afsar.
Afsar bought United Utilities' shares towards the end of last year, when the company once again found itself the subject of bid speculation in the British media, but has held off buying the stock this morning following the latest, renewed bid rumours.
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