Shares in London International Group, the world's largest producer of branded condoms, rose 27 per cent yesterday after it revealed it had received an unsolicited proposal for a possible merger.
The UK-based group, which owns the Durex brand and also produces rubber and surgical gloves, said the approach was a preliminary one and it had made a statement because of the recent increase in its share price.
The shares rose 35p to 163p yesterday, valuing the group at about £570 million (€772 million ). Analysts said the approach was opportunistic given last month's slump in LIG's shares to their lowest since 1996. The shares lost 30 per cent in one day in early December, falling to 130p, after the group warned on profits because of a drop in sales of lower margin medical examination gloves. They had traded at 228p earlier in the year.
Analysts pointed to Ansell, part of Pacific Dunlop, the diversified Australian group, Safeskin of the US and Okamoto Industries, Japan's leading condom company, as among the possible bidders.
They ruled out Carter Wallace, the US market leader and owner of the Trojan brand, because of competition issues. Together, the US company and LIG have more than two-thirds of the US condom market. Carter Wallace controls about half the US market, while LIG has about a fifth.
