Regulator opens probe onDanone share movements

26th July 2005, Comments 0 comments

PARIS, July 26 (AFP) - The French stock market regulator AMF said Tuesday it had opened an investigation into the trading of shares in French food group Danone, which is rumoured to be a takeover target for US company PepsiCo.

PARIS, July 26 (AFP) - The French stock market regulator AMF said Tuesday it had opened an investigation into the trading of shares in French food group Danone, which is rumoured to be a takeover target for US company PepsiCo.

Shares in Danone have jumped 27 percent in the past two weeks amid speculation that PepsiCo, the US soft drinks and snack maker, is preparing a hostile takeover bid.

An AMF spokesman told AFP: "The AMF has opened an investigation into information surrounding Danone and share trading in order to determine that no breaches of the rules occurred in recent weeks."

Commenting on the AMF statement, a spokeswoman for Danone said: "Danone has taken note of the launch of the investigation and will reply to all the questions put to it by the AMF".

The head of a French minority shareholders association ADAM was quick to praise the decision of the AMF to investigate the dramatic movements in Danone shares during "a crazy week" of trading on the Paris stock exchange.

"We need to determine who was responsible and to know who had an interest in starting the rumours and with what objective," Collette Neuville told AFP.

ADAM, or the Association for the Defence of Minority Shareholders, had asked the AMF to start an investigation last Thursday, she said.

Rumours that PepsiCo was preparing a hostile takeover bid for Danone were sparked by a report in French business magazine Challenges at the beginning of July.

Last week, comments from French politicians about a possible threat from PepsiCo fuelled further speculation, sparking another bout of speculative buying by investors.

Copyright AFP

Subject: French news

0 Comments To This Article