Invensys today poured cold water on reports that it was the takeover target of a Chinese train-maker, sending the FTSE 250 engineering group’s shares rising 4%.
Invensys, whose products include rail signalling, had been linked to a £2 billion bid from China Southern Rail, which is majority-owned by the Chinese government. The approach was thought to be part of CSL’s plans to expand into Europe, just weeks after Invensys had said talks with US giant Emerson Electric had come to nothing.
But today Invensys, which employs 3,000 people in Britain, said the company’s position hadn’t changed since an announcement last week, when it said that no other discussions were taking place in relation to an offer for the group. The City still backed the firm, though, and shares increased 8p to 230.7p.
Alex Jarvis, analyst at Peel Hunt, said: “We see good fundamental value for a business that is making good progress and contains some prize assets in terms of brand names and strong technologies in growing markets.”
Back in 2010, Invensys’ then chief executive, Ulf Henriksson, told a newspaper that the firm could be the target of a takeover by China Southern Rail. The suggestion sent shares soaring, but the company was then forced to issue a statement denying it was in takeover talks.
