Colt spurred by BT bid rumours

There was a feeling that BT is not a credible bidder, even if Colt's customer base would make a tasty prize.

BT has committed itself to further debt reduction and organic growth, not acquisitions of the scale that almost ruined it before. BT's Ignite business also overlaps with Colt in Germany and Holland.

Rumours spread of a takeout price ranging from 65p to as high £1 a share. 'This implies no one really knows what they're talking about,' said one sector watcher, who thinks BT will wait to try to pick up Colt at nearer 40p.

Fidelity was also at the centre of Big Food Group's 4 3/4p advance to 86p. The owner of Iceland stores jumped from five-week lows after Fidelity added 4.52m shares, taking its stake to 28.78m or 8.4%.

Boots' misery at the hands of the analyst community got worse. Just three days after Credit Suisse First Boston gave the chemists group a kick over its accounting policies, Credit Lyonnais put out a sell note.

Its retail expert, Paul Smiddy, thinks Boots shares, off 2p to 685p, are still 'way ahead' of his new 600p target price.

The problems are two-fold. News on Boots' 'strategic initiatives' - attempts to get into more upmarket services such as dentistry and beauty treatments - are likely to be disappointing at its final results on May 30. The short-term outlook may be deteriorating-Smiddy thinks there is a need to forgo profit growth to overhaul logistics and refurbish the stores. He also scotches hopes of a merger with Sainsbury.

Cambridge chip designer ARM Holdings, down 8p to 217p, was also given a drubbing after a sell note came winging across dealers' desks from West LB. The broker believes ARM's accounting practice of using future income to bolster current revenue figures will backfire as it will not be able to sustain that rate of future revenue growth.

West LB also suspects that ARM's future sales will disappoint because existing technology will be perfectly adequate for most customers, doing away with the need for upgrades. It set a target price of 170p.

Software group Logica, which has taken a pounding in the past six months from above £10, bounced to the top of the Footsie leader board. Bargain-hunters lifted it 10 1/2p to 232 1/2p amid reports that it is considering selling its mobile phone messaging unit, Logica Mobile Networks.

The Footsie drifted down 9.9 points to 5208.1, with just 1.6bn shares traded, dragged down by a negative opening on Wall Street.

Many markets in Europe were closed for a public holiday and the main UK company news was the results from British Airways, up 2p to 237 1/2p.

Banks were weaker, blamed on profit-taking. Anglo American was among the leaders, 20p higher at 1205p after reports that gold is making a comeback.

Sterling was little changed against the dollar at $1.4576. The euro, at

63.2p, held on firmly to last week's gains, despite Gordon Brown's attempts to dampen speculation on an early referendum and new CBI boss Sir John Egan's warning that industry is now neutral on euro entry. The single currency also hung on against the dollar, at 92.17 US cents, helped by worries about the strength of the US recovery.

Compact generators maker Turbogenset cranked 6p higher to 62p, ahead of its quarter results tomorrow. Investors are anticipating progress with US majors such as GE.

Health club operator Esporta, off 1p to 78 1/2p, gave short shrift to an 80p-ashare offer from Duke Street Capital, valuing the business at £133m. The board said it 'materially undervalued' Esporta and its prospects.

BetInternet, tipped here on Saturday, rose 1 1/2p to 19p after raising £1.25m in a placing by Williams de Broe at 16p to expand its website and systems for the World Cup and the next football season.

BLOOMSBURY Publishing fell 7 1/2p to 775p after warning that it is not counting on a new Harry Potter novel this year, but will still deliver expected group profits. It is buying Whitaker's Almanack, first published in 1868, from the Stationery Office for £750,000 cash.