Shares in British budget airline easyJet jumped more than 15 per cent today on speculation that an Icelandic airline could be building a stake or mulling a takeover, dealers said.
Several dealers said the latest talk that easyJet could be a takeover target had been spurred by a report that Air Atlanta Icelandic, Iceland Express or Icelandair could be casting an eye over it.
Air Atlanta parent Avion Group and Iceland Express said they had not bought a stake in easyJet.
Reykjavik-based Icelandair, which said last week it was looking to expand through acquisitions, could not immediately be reached for comment.
EasyJet said it did not know what was behind the share price rise. By 12.05 p.m. easyJet shares were up 14.89 per cent at 150-1/2 pence, valuing the company at over £580 million sterling ($1.1 billion). Almost 40 million shares had traded, almost seven times the daily average.
Several dealers said there was talk stockbroker Teather & Greenwood was seeking to buy up to 50 million easyJet shares - worth about £75 million - but details were vague and Teather declined to comment.
EasyJet shares hit an all-time low late last month on concerns about rising fuel costs and the company's warning fares would remain under pressure next year as competition bites.
Both easyJet and rival Ryanair have warned of a tough winter.