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Sony rally shortlived as speculation dismissed

Tuesday, October 26, 2010

TOKYO |
Tue Oct 26, 2010 11:32am EDT


TOKYO (Reuters) - Shares of Sony Corp rose nearly 3 percent at one point on Tuesday, but later retreated as analysts dismissed speculation that the electronics maker could be an acquisition target of Apple Inc.
Helping to spark the speculation was a Saturday report in Barron's that said cash-rich Apple could be contemplating a big acquisition and noted speculation about Adobe, Sony and Disney as potential targets.But even the author of the report, Eric Savitz, on Tuesday sought to clear up misconceptions about any potential combination of Apple and Sony.He wrote in a blog post on Barron's website, "In the piece I noted that the company could do something aggressive, like bidding for Adobe, Sony or even Disney. But that was pure speculation. Yeesh."The issue about Apple's acquisition plans gained steam earlier this month when, on conference call with investors and reporters, Chief Executive Steve Jobs was asked what the company would do with its $51 billion in cash."We would like to continue to keep our powder dry, because we do feel that there are one or more strategic opportunities in the future," Jobs said.But analysts who follow technology downplayed the likelihood that Apple wo!
uld chase Sony -- or any other major acquisition."We don't see any acquisitions of any size," said Ashok Kumar, an analyst with Rodman & Renshaw in New York. "Apple is happy to keep its cash under the pillow."Kumar said a deal for Sony would be particularly unlikely. "It would be a cultural miss," he said.Sony spokeswoman Sue Tanaka said: "We cannot comment on rumors or speculation."Sony shares closed up 0.7 percent at 2,742 yen after climbing as high as 2,804 yen. Trading volume was 17.61 million shares, the highest since July 30, the day after the company surprised the market with a quarterly profit and raised its full-year profit outlook.Shares of Apple were down less than 1 percent in premarket trade.The benchmark Nikkei average fell 0.3 percent.(Reporting by Paul Thomasch in New York and Chikafumi Hodo, Sachi Izumi and Isabel Reynolds in Tokyo; Editing by Chris Gallagher)
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