We highlighted the attractions of the UK utility sector back in May (Better than gold), so it was little surprise to see bid rumours surrounding United Utilities, lifting its shares by over 7 per cent, to 730p, and giving sector peers Severn Trent and Pennon a boost as well.
IC TIP:
Hold
at
730p
Press reports suggest an offer around 900p a share could be on the way, with the usual suspects of sovereign wealth funds and private equity in the frame. But analyst Guy MacKenzie at Credit Suisse said a takeover was unlikely owing to its large size and uncertainty on cost recovery given the household retail price limits being introduced in the 2014 price control review.
