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Sun 1 Oct 2006 04:00 AM

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Trade sparks takeover talk

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Electrolux, the world’s second largest household appliance manufacturer, could be the subject of a takeover bid following a massive rise in the company’s share value over the past two months.

A total of 11.5 million Electrolux shares were traded in just one day last month, the most since June and the second-busiest day this year, according to Bloomberg data. The boom in trade saw the company’s shares increase 16% in value and led Bloomberg to value the company at US$5 billion.

Electrolux has responded to the threat by declaring it would pay a special dividend to its shareholders and buy back stock, making it less attractive to potential suitors looking to cash in on the company’s vulnerable position.

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