Danone shares jump on report of Pepsico bid

7th July 2005, Comments 0 comments

PARIS, July 7 (AFP) - The price of shares in French food giant Danone jumped by 5.56 percent in initial trading here on Thursday on a press report that US drink group Pepsico wanted to buy the business, traders said while noting that Pepsico had denied this.

PARIS, July 7 (AFP) - The price of shares in French food giant Danone jumped by 5.56 percent in initial trading here on Thursday on a press report that US drink group Pepsico wanted to buy the business, traders said while noting that Pepsico had denied this.

Danone shares gained 5.56 percent to EUR 76.90.

One trader who declined to be named commented: "These are (takeover) rumours which are coming round again. This happens all the time and this time they are perhaps a little more credible. Our customers have been more inclined to sell Danone shares recently."

Another trader commented that in the United States, ADR traded paper in Danone had risen by 9.0 percent in value but that Pepsico had denied the report.

Pepsico had issued a statement saying that a report in French magazine Challenges that it had bought 3.0 percent of Danone was wrong.

Challenges had reported that Pepsico wanted to buy Danone and had recently bought eight million shares in the group at a price of EUR 66.0-72.0 per share.

The report suggested that Pepsico was prepared to spend EUR 25.0-30.0 billion to buy Danone which was capitalised at about EUR 19.0 billion.

© AFP

Subject: French news

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