Mmo2 talking to Spanish telco

AS the festive season draws closer, the market is buzzing with talk of holiday romances and the possibility of a Christmas engagement. But which couple will make an announcement first?

Mmo2 was looking pretty yesterday, following reports that chief executive Peter Erskine met his counterpart at Spain's Telefonica. Mmo2 declined comment. Dealers will be combing through its results tomorrow for hints of whether it would be amenable to a proposal.

Dresdner Kleinwort Wasserstein advised buying the shares, but does not believe a takeover approach is imminent as Telefonica is still digesting its last purchase in Latin America. Mmo2 rose 1½p to 107p.

JP Morgan is not an admirer. The broker advised swapping mmo2 shares for Vodafone (up 1p to 142¾p), which reports interims this morning. Dealers hope Vodafone's interim dividend will double to 4p.

Novar jumped another 7½p to 163p on speculation that a white knight may save it from the clutches of Melrose (down 7p to 127½p). Germany's Siemens declined to comment on weekend speculation that it is preparing a bid.

Could Bob the Builder marry his Swiss Miss? Yesterday, HIT Entertainment, which owns the rights to Bob and other children's characters, played down weekend reports of a proposal from the Geneva-based Mediawin Partners. HIT says its regularly meets with potential investors, including Mediawin, but has never discussed a bid. Still, HIT finished 6¾p higher at 246½p. Merrill Lynch recommends buying.

Bob may be beaten down the aisle by information technology firm ITNET (up 23½p to 258½p). It stretched Friday's gains after confirming preliminary takeover talks. Punters believe LogicaCMG (down 1¼p to 195¼p) could be the suitor.

Dealers say the stormy dalliance between Manchester United and US investor Malcolm Glazer appears to be on the rocks - for the time being - after Glazer's bankers and public relations agency resigned last week. ManU slipped 7¼p to 278¼p with dealers betting that Glazer may be unable to secure alternative funding.

Early speculation that US sugar daddy Eastman Kodak may be mulling an approach for photo booth operator Photo-Me died down by the close. Photo-Me ran as high as 93p before settling back to 88p. Dealers pointed out that Kodak is suffering as digital photography grows more popular. But Photo-Me's market capitalisation of £350m is a tiny dowry for Kodak, which is still worth more than £5bn.

All this talk of romance helped the Footsie to its fifth straight gain. The benchmark stretched 9.2 points higher to 4803.1, its best finish since June 2002.

Weakening oil prices also encouraged buying. Brent tumbled by more than $2 a barrel to $40.20 - its lowest level in eight weeks - after the Nigerian government averted a general strike that would have halted oil production. Oil inventories are also rebounding in the US, easing fears of winter shortages.

The weak dollar recouped some recent losses, following US treasury secretary John Snow's reiteration of America's strong-dollar policy. Sterling slipped to $1.8470, while the euro stood half a cent weaker at $1.2930, after hitting a record $1.3005 late last week. That prompted European central bankers to publicly ponder market intervention to stabilise the dollar.

Perennial bridesmaid Sainsbury, unchanged at 273p, remained a wallflower yesterday, despite revealing that US value investor Brandes has increased its stake to 8.3% from 7.96%.

Hopes of a bid prompted Shore Capital to remove its sell recommendation. Half-year figures are due tomorrow.

Pearson (down 4½p to 635½p) could reap the benefits from the putative marriage of Dow Jones in the US and financial news provider MarketWatch. Dow has offered £282m for MarketWatch, valuing Pearson's 23% stake at £65m. Pearson is considering its options.

BAE Systems (down 4¼p to 248¼p) shuddered, with investors fearing Saudi Arabia, one of BAE's most important customers, may find a new supplier if investigations into Saudi procurement processes continue. Numis has advised clients to reduce their holdings.

________________________

MOBILE phone retailer Celltalk jumped 19p to 39½p after unveiling interim profits of £1.26m, up from £20,000 a year ago. Celltalk, Britain's largest vendor of Orange network mobile phones, has benefited as users trade up to camera-phones and the like. The second half has started well and punters are expecting more good news.

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in