Orchid soars on takeover talk

Shares in Orchid Developments Group (OCH) soared by 100% as the company confirmed it had received a "preliminary approach" from a third party.

However, the Bulgarian operating group warned that this approach "may or may not lead to an offer for the company being made".

"The approach is at a very early stage and there can be no guarantee that it will result in an offer being made," said the company, which invests in the Bulgarian real estate and leisure market.

The movement in the shares on Friday follows a positive 20% movement on Thursday, amid speculation that the company had found a buyer for its Grand Mall in Varna. Orchid dismissed these rumours.

Earlier this month, Orchid cautioned investors that "difficult" operations in Bulgaria and the "continuing crisis in the eurozone" could have an adverse impact on its cash flow and complicate its efforts to sell assets.

The company also halted construction of its Business Centre Varna project "due to the economic downturn", and at the end of November announced that it was in "advanced stages" of renegotiating the repayment terms for its non-recourse loan agreement totalling €3.1 million (£2.6 million) with Raiffeisenbank AG.

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