Hope not
Rogers Shares Surge On Takeover Rumors
TORONTO (Reuters) - Rogers Communications Inc. (NYSE:RG - news) class B shares rose nearly 8 percent Friday on renewed rumors that Microsoft Corp. (Nasdaq:MSFT - news) might buy a stake in it and on higher subscription numbers announced earlier this week.
Rogers Class B shares gained C$2.05 to C$29.00, a rise of 7.61 percent. The company's class A shares were also higher, climbing 12.33 percent to C$29.60, a gain of C$3.25.
Traders said market rumors that U.S. giant Microsoft Corp. might take an equity stake in the Canadian firm were pushing the stock up.
''Microsoft is talking with them but then they're talking with a lot of cable operators around the world,'' said an analyst in New York. ''Microsoft has shown an appetite to make investments to help propagate broadband services.''
Foreign ownership restrictions would preclude a takeover, analysts said, leaving an equity stake as the remaining option.
Tuesday, Rogers announced strong second-quarter subscriber results. Its 81-percent-owned Rogers Cantel unit added 109,500 cellular subscribers, quadrupling its subscriptions from the same period last year and topping last year's fourth-quarter figures -- traditionally the company's biggest quarter.
''Their preliminary results on cellular subscribers were excellent. But I'd be surprised though that it took the market this long to react to it. It's kind of delayed,'' said one Chicago-based analyst.
''There's no other explanation beyond the typical takeover speculation that encircles the company from time to time.''
Rogers' class B shares have gained C$2.90 since Tuesday's announcement. The company attributed the rise to the strong numbers released this week.
''I think we were oversold earlier in the month and hopefully this is just catch-up. There is no news pending,'' said Richard Harvey, director of investor relations at Rogers Communications. ''It's pretty dramatic for just two days but I don't have any other real good explanation.
''There's always other people with other reasons and there's always rumors flying around.'' |
