ASE rumor mill revives memories of 1999 bubble

The unbridled rumors that have proliferated with the stock market’s recent gains are distracting from the fact that some really important deals have been made. These deals and the massive inflow of capital from foreign funds have shaken up a formerly moribund market. This rise, however, has increased the maneuverability of those who live by manipulating the market through false, or partially false, rumors. The rumors have picked up in recent days, putting the fear into those who remember the 1999-2000 bubble and how it burst, hurting hundreds of thousands of investors. Indeed, almost half the recent announcements by listed companies to the Athens Stock Exchange’s management are denials of mergers, acquisitions and other deals that are supposedly about to take place. «The market authorities must work overtime just to inquire of the listed firms whether this or that article (announcing a deal) is true,» said one market insider. The culmination of these tactics was Friday’s story about a supposed participation of French bank BNP-Paribas in EFG Eurobank. Early in the morning, the rumor mill had it that an agreement had already been concluded; by noon, the story had changed to «they are just putting the finishing touches (into the deal)» and, by early afternoon, there was an official denial. Meanwhile, the bank’s stock had gained about 5 percent only to fall and end the day with slight losses. The rumormongers may have lost some of their credibility but they have a fallback story: BNP-Paribas «may» buy a stake in the Luxembourg-based holding company, owned by Spyros Latsis, which, in turn, controls EFG Eurobank. Banks are among the usual targets of rumors that spread in brokerages and newspapers. In recent months, France’s Societe Generale, the majority shareholder of Geniki Bank, supposedly wanted to buy Egnatia Bank as well; Citibank was to acquire a stake in National Bank and the French post office was another interested investor. More recently, we had Marfin’s supposed interest in buying HSBC’s 20 percent stake in Laiki Bank. One of the popular scenarios, which was ultimately denied, concerned the supposed interest of BrandCo, the new partnership between Delta Holdings and Chipita, to buy food companies ION, Papadopoulou and Giotis. Nikas was also sometimes added to the mix. Another supposed buyout in the foods sector concerned Cardico’s acquisition by Pepsico. Cardico and Druckfarben are often the targets of such rumors despite their repeated denials. Other recent rumors concerned the acquisition of Duty Free Shops and UK firm BC Partners. The latter has agreed to acquire Hyatt. Soon after this agreement – a real one, for a change – BC Partners was rumored to be interested in Altec Telecom and other companies. Another real acquisition that first had passed through the rumor mill was that of LogicDis by GOT Holdings, the main shareholder of Singular group. Info-Quest, another rumor mill target, was said to be involved in the deal, as well.

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