Dell soars on IBM takeover rumour
SAN FRANCISCO (AFX) - Shares in Dell Computer Corp soared in late trading,
amid rumours that International Business Machines Corp may be considering a bid
for the company, said dealers, although analysts said a IBM/Dell deal is
unlikely to emerge.
At 3.55 pm in New York trading, Dell rose 2-7/16 or 10 pct to 26-7/8, while
IBM gained 2.01 usd to 114.23 and Gateway added 1.02 usd or 5.2 pct to 20.70.
The Nasdaq composite was 22.56 pts higher at 2,665.77 and the DJIA fell 5.02 to
10,960.83.
"Rumour has it that IBM may be taking a peak at someone like Dell," said Art
Hogan, chief market strategist at Jefferies & Co.
Art Russell at Edward Jones, however, called an acquisition of Dell by IBM
"far fetched", although he noted that similar speculation has in the past
circulated about the two companies.
A deal between Gateway Inc and Dell would, according to Russell, make more
sense than a merger of Dell and IBM. Russell sees the greatest synergies between
Dell and Gateway, as both companies have direct models and complementary market
segments
Morningstar's Joe Bealieu agreed a Dell/IBM deal is unlikely.
"That would be a huge surprise because companies in the sector are trying to
get away from the PC rather than get more exposure to it," Beaulieu said. |
