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UPDATE 1-Sony shares rise on speculation of Apple interest

Published 10/26/2010, 03:51 AM
Updated 10/26/2010, 03:52 AM

* Speculation sparks biggest trading volume in 3 months

* Sony declines comment on rumours

* Analysts sceptical about possibility of a buy-out (Adds closing price, details)

TOKYO, Oct 26 (Reuters) - Shares of Sony Corp rose nearly 3 percent at one stage on Tuesday as traders cited media reports speculating that the Japanese electronics maker could be a potential acquisition target of Apple Inc.

Helping to spark the speculation was a Saturday report in Barron's that said cash-rich Apple could be contemplating a big acquisition and noted speculation about Adobe, Sony and Disney as potential targets.

Sony spokeswoman Sue Tanaka said: "We cannot comment on rumours or speculation."

During an Oct. 18 conference call with investors and reporters following Apple's latest earnings announcement, CEO Steve Jobs was asked what the company would do with its $51 billion in cash.

"We would like to continue to keep our powder dry, because we do feel that there are one or more strategic opportunities in the future," Jobs said.

Some analysts were sceptical about the feasibility of a buy-out.

"If Apple tries to buy the whole of Sony, it will be a hostile takeover, and that will probably not succeed in Japan," said one analyst in Tokyo, who declined to be named.

"I don't think Sony would want to join hands with Apple since it is working with Google to compete against Apple," he added.

Sony shares closed up 0.7 percent at 2,742 yen after climbing as high as 2,804 yen. Trading volume was 17.61 million shares, the highest since July 30, the day after the company surprised the market with a quarterly profit and raised its full-year profit outlook.

The benchmark Nikkei average fell 0.3 percent. (Reporting by Chikafumi Hodo, Sachi Izumi and Isabel Reynolds; Editing by Chris Gallagher)

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