Danone shares jump Kraft takeover bid rumours

29th November 2005, Comments 0 comments

PARIS, Nov 29 (AFP) - French dairy products group Danone, formerly a rumored takeover target for PepsiCo, could attract a bid from US-based rival Kraft Foods, according to speculation relayed by traders on the Paris stock exchange on Tuesday.

PARIS, Nov 29 (AFP) - French dairy products group Danone, formerly a rumored takeover target for PepsiCo, could attract a bid from US-based rival Kraft Foods, according to speculation relayed by traders on the Paris stock exchange on Tuesday.

The price of shares in Danone was showing a gain of 2.52 percent percent to EUR 87.45 in a mid-day Paris trading, propelled by speculation on Kraft's possible interest in the group, said traders who asked not to be identified.

"There's a rumor today on the market that Danone could be a takeover target for Kraft Foods," said a trader at a Paris-based brokerage, who underlined that it was "just a rumor."

According to a London-based dealer, there have been suggestions that food and tobacco group Altria might spin off its Kraft unit.

"That is leading to speculation that Kraft may then make a bid for Danone," he said.

Kraft Foods markets such products as Milka chocolate, Maxwell coffee and Nabisco crackers, operates in more than 155 countries and has annual sales of about US $34bn (EUR 28bn).

Danone's operating health, geographical footprint, product portfolio and strong top-line performance mean that takeover rumours emerge on a regular basis, with Coca-Cola, Nestle and Unilever among the names thought to be interested.

Danone earlier this year rose as much as 25 percent on speculation that US soft drinks and snack food giant PepsiCo was looking to make an offer.

But hopes waned as company management, trade unions and the government said they would fight any attempt to take Danone out of French hands.

Copyright AFP

Subject: French news

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