FTSE 100-listed engineering firm Amec’s shares plunged 3.5 per cent yesterday, after speculation of a takeover approach for US rival Foster Wheeler triggered fears of a rights issue that would dilute the stock’s value.
Investors reacted badly to the idea that Amec would have to issue equity to fund a potential purchase of the £1.8bn Nasdaq-listed firm. Amec went ex-dividend yesterday, which also dented the share price.
City A.M. understands that Amec has since denied it is in talks with Foster Wheeler.
Amec, which made a failed approach for peer Kentz this summer, has been open about the fact it is on an acquisition hunt but will consider returning cash to shareholders if no deals are made.
Its shares closed at 1,124p.