Sky shares rally on reported interest from France's Vivendi

Sky shares rose 3.7% to 1059p on Wednesday amid speculation that France’s media giant Vivendi could table a bid for the UK listed TV and broadband operator.

Though Vivendi representatives denied Sky is an acquisition, market participants piled into Sky stock on an earlier Reuters report citing sources, that Vivendi could pay up to £28bn for the company.

Vivendi is reportedly interested in Sky as a possible option to expand its Canal Plus TV unit. Vivendi has turned its attention to Sky after reviewing smaller pay-TV targets in Turkey and other fast-growing markets in Europe, one of the sources said.

A London based trader said that though Vivendi has quashed the speculation, “the recent heat up in big deal activity in the European market, such as today’s deal between Shell and BG Group, has excited the market about more merger and acquisitions on the horizon.”