Eircom shareholders have been urged to sell their shares into the market now and not wait for a takeover bid from either eIsland or Valentia.

The "sell" recommendation from ABN Amro came as the Dublin and London markets saw phenomenal trading in Eircom shares, with more than 90 million shares changing hands yesterday - about 50 times the average daily turnover in the shares. Those 90 million shares represent more than 4 per cent of Eircom's total issued shares.

ABN Amro analyst Ms Jemma Houlihan has said Eircom shares are worth no more than €1.31, and that price assumes the most optimistic scenario. With the shares trading in the market between €1.29 and €1.30, the ABN Amro analyst said shareholders should sell now and "get their money for the summer" rather than wait for a bid which would take until next November to put money into shareholders' hands.

She added: "While the possibility of a `killer' bid at €1.40 still remains, we believe that, on balance, the risks outweigh the probability of this happening." Certainly, as the takeover battle for Eircom rumbles along, there is no shortage of buyers for the shares at €1.29. - mainly hedge funds and arbitrageurs. More than 66 million Eircom shares traded in London, with another 24 million trading in Dublin in a narrow range between €1.29 and €1.30. They closed on both markets at €1.30.

Dealers said that yesterday's trading, in many cases, involved the same arbitrageurs buying and selling shares repeatedly and taking a small profit from each deal.

These sort of investors are part and parcel of takeover bids.