Burberry shares spike on talk of stateside merger bid

Burberry has refused to comment on reports of a potential merger with a US rival.

Its share price rose 5% initially after the financial blog Betaville, citing sources, said Coach (HKSE: 6388.HK - news) had hired bankers to work on a possible offer. The shares closed 3% higher.

Burberry responded to the report by saying it did not comment on market rumours or speculation.

UK firms are attractive to foreign buyers at the moment given the pound's collapse in value against major currencies since the country's vote to leave the EU.

Earlier this week, Burberry revealed a 30% leap in UK sales during the three months to September - driven by tourists from China and the US taking advantage of the weak pound which makes sterling-priced items less expensive.

It said then that the more recent deterioration in sterling's value could add an extra £125m to annual earnings - £35m more than it had originally forecast.

Ahead of Friday's opening on the FTSE 100, Burberry had a market value of £6.4bn.