Wednesday, May 14, 2008 - 08:00
AFP News Briefs ListBHP shares soar on China stake rumours
Shares in mining giant BHP Billiton hit an all time high on the Australian stock exchange Wednesday on talk that a Chinese entity was seeking a stake in the group.
The stock reached a record high of 48.50 dollars (45.59 US dollars) in late morning trade before dropping back to 48.26 dollars by mid-afternoon -- still 5.4 percent up on the day.
Ron Cameron, a senior portfolio manager at stockbroking firm Ord Minnett, said there was talk among dealers that an unknown Chinese entity was preparing to grab a stake.
"The talk can't be dismissed out of hand as the Chinese have already built up a stake in Rio Tinto," Cameron said.
In February, China's state-owned aluminium group Chinalco built a 9.0 percent stake in BHP's takeover target, Rio Tinto, in a move that was widely seen as designed to buy a seat at the bargaining table should BHP gain control of the world's third-largest miner.
BHP doesn't comment on market speculation.
Rio Tinto was up 5.5 percent at 152.37 dollars at 3.30 pm (0530 GMT), having gained in London overnight on talk that BHP was preparing to lift its 3.4-for-1 scrip offer for its smaller rival.
BHP chief executive Marius Kloppers, at a Merrill Lynch Global Mining conference in Florida on Tuesday, would not comment on the speculation but again stressed his view that his group's growth potential was superior to Rio Tinto's.
