Cordiant recovers as City senses takeover

LONDON - Shares in Cordiant Communications have been among the highest movers on this morning's FTSE 250, climbing 7% to 160p as investors increasingly see it as a takeover target.

The price recovered more ground on the back of its interim results, which were released this morning. By lunchtime, Cordiant's shares were up 10.5p as investors sought to buy while still relatively cheap.



Brand Republic reported earlier this morning that Cordiant's share price dropped 20% last week and that it is expected to announce a further 300 redundancies worldwide, after filing interim pre-tax profits up 26.6%.



Investors will be hoping a takeover bid will trigger a steep rise, such as the 50% rise experienced by Tempus Group when Havas Advertising launched its takeover bid.



Analysts have earmarked the independent company as vulnerable to a bid, as it is trading at a price-earnings ratio of 10.



According to analysts, potential buyers could include WPP Group, Omnicom Group or the Interpublic Group of Companies.



However, given the current state of the market, Cordiant is believed to a long-term takeover target.



Ian Valentine, recommends

Cordiant Communications

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