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PARIS (Reuters) - Shares in French aero engines and telecoms group Safran surged almost 7 percent on Thursday after U.S. mobile phone maker Motorola Inc expressed interest in Safran's mobile phone and fax arm Sagem.
In September, Safran said it was studying all options for Sagem, which has been dogged by a series of financial losses.
The possible sale of Sagem had already prompted market speculation that Motorola might be attracted by it, and a leading Motorola executive confirmed to French paper Le Figaro that the U.S. company was looking at Sagem.
"We have a serious interest in Sagem. It's an option in a sector that is in the process of consolidating ... I do not know yet if we will get it," the head of Motorola's mobile devices business Ronald Garriques told Le Figaro in an interview.
Safran shares rose as much as 6.8 percent to an intraday high of 17.94 euros. The stock was up 5.7 percent at 17.75 euros in early afternoon trade in Paris.
Safran said it welcomed Motorola's interest.
"Following statements by Motorola reported in a major French daily national newspaper, Safran is pleased to note that one of the major players in the telecommunications market has publicly recognised the quality and professionalism of the teams at Safran's mobile phones division," it said in a statement.
"Safran also notes that a potential link-up with another mobile phone maker is only one possibility to ensure the sustainable success of this business," it added.
A Safran spokeswoman reiterated that all options were being considered for Sagem, but declined further comment.
"We want to keep our staff and find the best possible solution," she added.
Safran was created through the 2004 merger of aerospace group Snecma and Sagem, but there had been widespread market speculation of rifts between the two separate businesses.
In August, the head of Safran's telecoms arm quit, sparking speculation of a possible sale of the Sagem unit.
Based on latest prices, Safran shares have fallen by around 13 percent since the start of 2006, underperforming a 16 percent rise in the broader French SBF120 index
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In September, Safran said it was studying all options for Sagem, which has been dogged by a series of financial losses.
The possible sale of Sagem had already prompted market speculation that Motorola might be attracted by it, and a leading Motorola executive confirmed to French paper Le Figaro that the U.S. company was looking at Sagem.
"We have a serious interest in Sagem. It's an option in a sector that is in the process of consolidating ... I do not know yet if we will get it," the head of Motorola's mobile devices business Ronald Garriques told Le Figaro in an interview.
Safran shares rose as much as 6.8 percent to an intraday high of 17.94 euros. The stock was up 5.7 percent at 17.75 euros in early afternoon trade in Paris.
Safran said it welcomed Motorola's interest.
"Following statements by Motorola reported in a major French daily national newspaper, Safran is pleased to note that one of the major players in the telecommunications market has publicly recognised the quality and professionalism of the teams at Safran's mobile phones division," it said in a statement.
"Safran also notes that a potential link-up with another mobile phone maker is only one possibility to ensure the sustainable success of this business," it added.
A Safran spokeswoman reiterated that all options were being considered for Sagem, but declined further comment.
"We want to keep our staff and find the best possible solution," she added.
Safran was created through the 2004 merger of aerospace group Snecma and Sagem, but there had been widespread market speculation of rifts between the two separate businesses.
In August, the head of Safran's telecoms arm quit, sparking speculation of a possible sale of the Sagem unit.
Based on latest prices, Safran shares have fallen by around 13 percent since the start of 2006, underperforming a 16 percent rise in the broader French SBF120 index
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