Business Connexion (BCX) has poured cold water on speculation that potential bidders for the company may be coming back with revised offers after talks failed last month.
The BCX share has been trading at between 780c and 790c recently, after the share plunged from 780c to 690c on news that the talks with Telkom and Bytes Technology Group, both of which had expressed interest in acquiring the group, had been terminated.
Prior to this, market interest in the discussions had driven the JSE-listed BCX share from a close of 635c on 15 November, the day before the group published a cautionary notice, to trade at 850c on 1 December.
Financial director Alan Farthing said BCX had ended the talks as it believed the prices being mentioned were far too low.
BCX`s CEO, Peter Watt, says there is no truth to speculation that potential bidders may be preparing to table better offers. If there were truth to the rumours, BCX would have put out a cautionary notice.
Analyst Irnest Kaplan, MD of Kaplan Equity Analysts, says the share price`s rise does not necessarily mean a revised offer may be made.
"I wouldn`t say there is necessarily something lurking in the background," he says.
"It`s possible. I wouldn`t rule it out. But it could also be an underlying safety value. Investors don`t know what price was offered, but it was probably around these levels - R7 or higher. If it was around R6, someone would know."
He adds that BCX has not made any announcement. "And they would have to with a deal of that size."
Kaplan adds that the share price rose sharply after the initial cautionary notice was issued, rather than before, which indicates that the information about the talks was not leaked to the market before that notice.
"If it had jumped before they published the cautionary, then I would think something was happening now, but I think it`s unlikely."
Kaplan says the share is likely to remain at mid-R7 levels.
The share was trading at 780c on the JSE this morning.
* For an exclusive report on the reasons behind Business Connexion`s decision to reject the bid, read the February issue of ITWeb Brainstorm magazine, on sale 2 February.
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