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Last Updated: Thursday, 4 November, 2004, 16:52 GMT
MFI shares rally on bid rumours

Shares in furniture retailer MFI have jumped 5% on rumours that Argus-owner GUS or an investment vehicle could be about to launch a takeover bid.

B&Q-owner Kingfisher is also rumoured to be interested in making a bid for either the firm or for just its successful Howden Joinery business.

MFI has been struggling to revive sales and its shares have fallen more than 40% over the past year.

It had to issue a profits warning in September because of delivery problems.

At the time it said there had been "significant issues" with its new supply chain system, which meant orders had not been delivered as planned.

Howden outshines

The company, which floated on the market in 1992, has faced increased competition from rivals.

However, its Howden Joinery business - which sells kitchens and carpentry products to the building trade - has remained a success.

In September, MFI said the Howden's business had continued to perform "strongly", with trading ahead of expectations.

"MFI has one really good business (Howden) and one really bad one (retail)," said Tim Green, analyst at Brewin Dolphin Securities.

But some commentators believe that MFI would want to be sold as a whole and say it would be difficult to disentangle the retail and joinery business.

By the close of trade on Thursday, MFI shares were 5.37% higher, up 5.5 pence at 108p.

MFI shares dive on delivery woes
09 Sep 04  |  Business
Sales slump hammers MFI profits
22 Jul 04  |  Business
MFI shares hit by declining sales
20 May 04  |  Business

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