A call to do something about the disorderly market from the Stock Exchange to Kleinwort's broker, Cazenove, prompted the denial, which sent the share price plummeting to a low of 599p, before closing at 620p.
Dresdner Bank also denied this latest bout of speculation, fuelled by a Frankfurt financial newsletter's claim that Germany's second biggest bank, which has declared ambitions to boost its presence in London, would bid next week for Kleinwort Benson at 800p per share. Dresdner said both this report, and the suggestion it already holds a 3 per cent stake in Kleinwort, were "completely without foundation".
The yo-yoing in Kleinwort Benson's shares occurred against a background of heightened expectation in the City that the investment banking sector is about to see another bout of consolidation. Despite the denial, Dresdner is regarded as a likely bidder, and well-placed sources inside the bank confirm there have been discussions recently with interested parties in London, but that the prices mentioned were too high.
Dresdner has stated it intends to strengthen its modest investment banking activities in London. It has come under increased pressure to act from its main domestic rival, Deutsche Bank, which wants to build London into the European springboard for its global investment banking ambitions.Reuse content