Perpetual shares soar after approach from Amvescap

Martyn Arbib, the founder and controlling shareholder of Perpetual, saw the value of his stake in the fund management group soar 18 per cent to £456m yesterday, after it emerged that the group had been approached by its rival, Amvescap, over a potential £1.2bn takeover bid.

People familiar with the discussions said that that the talks were at a very early stage, and it was far from clear whether Amvescap which is also bidding $1.8bn for Trimark in Canada was prepared to table an offer at a price which Perpetual would be willing to accept.

One source close to the talks said: "They have had a few conversations. But they have not made an offer." After Perpetual confirmed the talks in a brief stock exchange statement, the finance director, David Mossop, said: "We made that statement because the Takeover Panel requested it but there is really not much more we can say at this stage."

The 60-year-old Mr Arbib, a keen racehorse owner, has retained Merrill Lynch as an adviser and is believed to have been looking for a buyer for his 38 per cent stake for over a year. Previous talks with potential buyers have foundered on a failure to agree a price. In the absence of a deal, Mr Arbib has been taking advantage of periodic spikes in the volatile Perpetual share price to cash in part of his family stake.

Analysts said the rumoured price of £50 a share was not unreasonable. The group is expected to publish figures next Tuesday showing pre-tax profits up around 9 per cent to £73m. Funds under management are also expected to have risen from last year's £10.9bn to more than £12bn in the first half.

Perpetual shares soared 660p to 4030p. Amvescap fell 75 p or nearly 8 per cent to 872p on concern that an all-share offer would dilute earnings.