Investec has kept its buy rating on Dundee-based diagnostics firm Axis-Shield, following yesterday's statement by potential buyer Alere urging shareholders to accept its 460p-a-share bid.

Alere said that since the announcement of a possible offer was made in July, Axis-Shield's share price has remained elevated due to the offer and has not traded on underlying fundamentals, as its key industry peers have fallen around 21% in the recent market volatility.

As such, Alere thinks that the 37% premium to the closing price on 5 July (the day before the first announcement of a possible offer) is still a significant premium.

"Whilst Alere makes some sensible points, we do not agree with all the points it is making and we remain of the view that whilst Alere is serious about acquiring Axis, it is trying to take advantage of current market conditions to buy Axis on the cheap," said Investec analyst Sebastien Jante.

The broker has suggested that shareholders should sit tight and do nothing at least until the 26 September, "the last day Alere can revise its offer under the current timetable. Nor do we see any point in doing anything before 10 October, the next closing date."

Investec keeps a 530p target price.

By 11:48 on Friday, shares were 1.85% lower at 450p.

BC

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