Domestic & General Group PLC, a provider of extended warranty and central heating cover, said it has received other approaches from parties which may or may not lead to an offer for the company.
On May 21, the company announced it had received an approach from Homeserve about a possible offer.
Seymour Pierce Analyst Kevin Lapwood, who had valued the Homeserve offer at just over 500 million pounds, said it was likely the offers had come from insurance companies.
“Obviously it is no-one from support services. If it is somebody in the insurance sector, and there are some decent synergies there to be had, then you could push the value up a bit,”
In a trading update, the company said a further announcement on the approaches will be made as and when appropriate.
Domestic & General also said trading in its core warranty business remains strong.
After its unit Inkfish Call Centres lost a contract with the Post Office and after increasing call centre demand from the group’s warranty business, Domestic & General said it is reviewing the overall strategy of its third party call centre business.
D&G, which protects over 6 million appliances in the UK, said the approaches may or may not lead to an offer for the company.
Shares in D&G, which started the year at 1,022 pence, were up 8.2 percent at 1,327 pence by 8am GMT, valuing the group at around 482 million pounds.
“We note the statement but have nothing more to say,” a spokesman for Homeserve.
Update 29/07/07 from The Independent
Bid talk sparked a tremendous rise for Domestic & General, after management admitted yesterday it had received several approaches for a full takeover. While the company refused to name names, it admitted there were “interested parties”; one was named last month as Homeserve. This helped gloss over the revelation that losing a contract in its call centre division meant full-year operating profits could be hit by £1.5m. The group, which revealed a strong warranty business, closed top of the mid-tier risers, up 134p – more than 10 per cent – at 1,361p.