Trinity surges on hopes of 'Mirror' sale

Tweedy Browne, the US shareholder that favours a sale of the Mirror national newspapers from its parent Trinity Mirror, raised its stake in the publisher to more than 5 per cent yesterday as rumours swirled the City about a sale of the Daily Mirror.

Trinity shares were the FTSE 250's biggest riser, up 6 per cent to 590p, as traders speculated that Sir Victor Blank's imminent departure might lead to a break-up of the group.

Sir Victor, who steps down at the group's annual meeting in April, has been seen in the City as an obstacle to any plan to separate the group's national titles from its vast stable of regional newspapers. He has privately denied this, saying he would consider bids for the national titles if the price was right. But the City's view has been that he favoured keeping the national and regional titles together.

News of Sir Victor's departure has triggered bookmakers to lay odds on who the new owner of the Daily Mirror might be. Stan James has made the private-equity group Candover Investments favourite at 7/4, with the German publisher Axel Springer second favourite at 7/2.

The bookmaker is even offering 500/1 odds against the Mirror's two former City Slickers, Anil Bhoyrul and James Hipwell. Bhoyrul was sentenced to 180 hours' community service last week for using the column to manipulate share prices. Hipwell faces jailafter being found guilty of market abuse in his time writing the column.

Sources close to Trinity said no expressions of interest in the national titles had yet been received. Its chief executive, Sly Bailey, is in the middle of a cost-cutting programme.

Tweedy described its decision to raise its investment as a rational one, given that it feels the shares are underpriced at 590p. The fund manager has in the past called for Trinity to sell its national titles. Tom Schrager, at Tweedy, said more stock was bought because "it's cheap stock. We're long-term investors".