Shares in Dutch navigation systems company TomTom rose as much as 7.2 percent on Tuesday on market rumours that Microsoft was interested in buying the company, though TomTom denied it was in talks.
“There is a rumour that Microsoft is interested in TomTom,” said a London-based trader, while another Dutch-based trader said the bid talk and an upbeat note from a brokerage was pushing up the stock.
TomTom, which makes portable navigation devices for cars and mapping software for handheld computers, forecast 2006 sales of 1.1 billion to 1.3 billion euros, targeting an operating margin of 20 percent.
Europe is currently the biggest market for these devices, with the United States a distant second. TomTom is European leader with more than half of the market for standalone car navigation devices.
The theory is that Microsoft could use TomTom as another entry point into the automotive systems market