Skip navigation

Compass said to be an acquisition target

LONDON Contracting giant Sodexho Alliance refuted rumors this morning that it intends to acquire arch-rival Compass Group PLC, but investors bid up Compass’ share price by nearly 2 percent on speculation that a takeover attempt may be in the works, according to observers here.

ACompass spokesman declined to comment, citing the company’s policy not to address speculation about acquisitions.

News reports circulated here this morning that an unidentified Dubai-based concern may be interested in Compass, but those reports could not be confirmed.

Through its Compass USA subsidiary, Compass Group is the largest foodservice company operating in the United States, with fiscal 2005 food and beverage revenues of $6.6 billion, according to Nation’s Restaurant News research.

Compass traded today on the London exchange at the equivalent of  $6.16 per share. The company’s market valuation is estimated at $12.36 billion.

 “I think it’s pretty unlikely that the company is in play,” said Karl Green, an analyst for Credit Suisse First Boston in London. “Sodexho already has come out and said the rumors are baseless. Of course you can’t exclude the possibility that they could go private. I can’t rule that out, but I’d say at this point it’s pretty unlikely to happen."

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish