The market was awash with speculation late last week, and the shares ended the week at 580p, a rise of 7.5 per cent in two days.
Analysts said the rise in the shares was largely due to arbitrageurs piling into the market in anticipation of a hostile bid surfacing early next week. Some 5 million shares changed hands on Thursday and Friday, including a block of 750,000 that was said to have been snapped up by an overseas buyer.
One analyst added that if the shares were to rise further in early trading, the Takeover Panel would press the company to issue a statement. Sources close to the company said no approach had been made, and it was not in talks with any suitor.
East Midlands has been in the bid spotlight several times this year. Potential US suitors have included General Public Utilities (GPU) of New Jersey, Pacific Gas and Electric and Houston Industries. A spokesman for GPU said the company did not comment on market rumours.
Recently, shares in the remaining independent regional electricity companies have been depressed on fears that heavier regulation and increased taxation under a Labour government would frighten off potential bidders. Shares in East Midlands were trading at over 700p in April, and even after last week's rise are still trading at a quarter off their high for the year.Reuse content