(Reuters) - Shares of Spirit AeroSystems
The Daily Mail said speculation about a bid ramped up on Wednesday with dealers hearing GKN could launch "a $5 billion cash and shares bid, worth around $35 a share," for Spirit, which makes fuselages and wing parts.
The newspaper said Bank of America/Merrill Lynch was reported to be advising GKN.
Ken Evans, a spokesman for Kansas-based Spirit, said the company would not speculate on rumors. He added that it had no announcement at this time.
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"If this report turns out to be true, then we think that it offers an excellent deal for Spirit's shareholders," RBC Capital Markets analyst Robert Stallard said in a note to clients on Thursday.
"Given the lack of profitability on its development programs, and a lack of cash generation, a bid at the reported level would seem extremely generous given the current situation," Stallard added.
Jefferies analyst Sandy Morris expressed doubts about a GKN acquisition of Spirit. "My personal view is that perhaps one division of Spirit may be for sale, and that would be the wing systems division. I think that that's much more likely," Morris added.
Spirit, spun off from Boeing a few years ago, is expected to lay off about 300 people on Thursday, a union leader said.
Shares of Spirit were up 7.1 percent, or $1.72, to $25.80 in morning trading. Earlier, the shares traded above their 52-week high of $25.86.
(Reporting by Karen Jacobs in Atlanta and Brenda Goh in London; Editing by John Wallace)
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