Methanex shares soar 8.9% amid Canada buyouts

16 April 2007 23:37  [Source: ICIS news]

HOUSTON (ICIS news)--Shares in Methanex soared 8.9% on Monday as the methanol producer was swept up in a wave of takeover speculation involving other Canadian companies, analysts said.

Another possible factor being mentioned was news of a shutdown of up to 45 days at the 1m tonne/year Fanavaran methanol plant operated by Iranian National Petrochemical Co (NPC) due to mechanical problems.

But analysts and North American methanol market participants were sceptical that the Iranian outage would be enough to spark the rally in Methanex shares.

"There has been a lot of speculation in the chemical industry about mergers and acquisitions," said Juan Plessis, an equities analyst at Vancouver-based brokerage Canaccord Adams.

US giant Dow Chemical and Canadian firm NOVA Chemicals have both been discussed recently as possible takeover targets, Plessis noted.

Methanex officials were not immediately available for comment. On the NASDAQ share market, the stock closed up $1.97 (€1.46) at $24.02.

Methanex is also listed on the Toronto Stock Exchange, where Canadian share prices have hit record highs this month on takeover speculation. The centre of attention has been a possible buyout of phone company BCE, which is valued at more than $25bn.

A source at another methanol producer said the Iranian problem was a relatively small issue in the context of the wider trend in the methanol market.

While Methanex would report healthy profits for the first quarter, the flat long-term outlook for the methanol market after the temporary surge in late 2006 was what investors should be focusing on, the source said on condition of anonymity.

Methanex is due to report its first-quarter earnings on 25 April.

($1 = €0.74)
By: Stephen Burns
+1 713 525 2653

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