EutelSat Communications shares rise on talk of possible takeover

[BGonaSTICK]

Eutelsat Communications shares rose Monday after the satellite operator said its board and several shareholders have been "approached" about a possible transaction involving its capital.

The board "has not been informed of the final position of its shareholders, nor is it aware of an auction procedure," Eutelsat said, without revealing who had made the approach.

Shares of the parent company of Paris-based Eutelsat SA, which operates a fleet of 23 communications and broadcasting satellites, had already risen earlier Monday on anonymously sourced press reports that it had received a takeover offer from a private equity house.

The stock rose as much as 6.8 per cent to 15.44 euros ($19.72) in Paris after the statement was issued.

Speculation of an impending private equity deal has intensified in recent weeks. Some analysts say the visibility of Eutelsat's future cash flow and strong asset base make it an ideal candidate for a leveraged buyout.

Separately, French investment company Eurazeo said two of its investment funds, RedBirds Participations and BlueBirds Participations, have been approached regarding selling their shareholdings in Eutelsat.

"No decision has been taken at this stage," Eurazeo said in a statement. It did not say who had approached them.

Eutelsat said it is being advised by Lazard Freres on the valuation of a possible deal.