Shares in German retailer Arcandor jumped in morning trade today (28 January) after rumours surfaced that US retail giant Wal-Mart is preparing to buy a stake in the group.
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Shares were up 10.83%, rising from an open of EUR1.86 to EUR2.02 at 12.37pm (GMT).
However, Thomas Nagel, a trader at Equinet AG in Frankfurt, remained sceptical about the rumours.
“The extremely high volatility in this stock means a story like this has really driven the price. But you must remember that Arcandor shares have lost 60-70% of their value in the last six weeks,” Nagel told just-food.
Shares in Arcandor have fallen by more that 80% over the past year as the retailer, which also owns travel company Thomas Cook, has seen profits sink.
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By GlobalDataArcandor recorded a loss of EUR746m (US$992.4m) for its 2007/08 fiscal year, after weakening consumer demand – particularly at its Karstadt department store business – hit revenues.
Nagel was also unconvinced by the suggestion that Wal-Mart is looking to re-enter the German market.
“Wal-Mart was a player here in Germany two years ago – but they closed their stores because of the heavy fire from German retailers. Now they are coming back for a second try? And with this company, which is experiencing severe problems? I don’t think so. Maybe one day, but at the moment it is just a trader rumour,” Nagel said.
Wal-Mart sold its hypermarket business in Germany in 2006 to Metro Group.
When contacted by just-food, a spokesperson for Arcandor declined to comment on market speculation. Wal-Mart was not immediately available for comment.
