Axon shares soar on counterbid hopes

By Malcolm Locke

LONDON (Reuters) - Shares in computer software firm Axon Group AXO.L soared on Tuesday on expectations of a counterbid to Infosys Technologies's (INFY.BO) 407 million pound offer for the British-based company.

Axon shares were 20.9 percent higher at 607.5 pence by 12:19 p.m., above the 600 pence a share cash offer.

Infosys, India's No.2 software services company, agreed to buy Axon on Monday, a public holiday in the United Kingdom.

Axon announced an interim dividend on Tuesday of 2.25 pence per share, which shareholders will be entitled to as part of Infosys's bid.

Some analysts said they were expecting a counterbid while others said it could spark more activity in the sector.

Jonathan Imlah of Altium Securities said the Infosys 600 pence offer was not a knock-out price and expected Axon shares to move higher in anticipation of a rival offer.

"Axon is a global leader in its field. We believe there is room for a counter-bid closer to 700 pence a share," Imlah said in an investment note on Tuesday.

Landsbanki Securities analyst Michael Donnelly said software services firm Morse (MOR.L) could attract a takeover offer, while Anite (AIE.L) and Innovation (TIG.L) also could be vulnerable to overseas acquirers.