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Shares in Pilbara iron ore miner Fortescue Metals jumped yesterday amid speculation diversified commodity trader Noble Group had bought a stake in the company.
The Sydney Morning Herald cited an unnamed source for the speculation, but the rumour was quickly denied by Noble Group.
The news follows a move last week by one of FMG’s most influential investors to sell almost all of its stock in the company.
Manhattan-based investment fund Leucadia National, an early buyer in FMG, reduced its stake to around one per sent, selling off over $US500 million worth of stock.
After the move Bell Potter analyst Fleur Grose told The Australian the stake in FMG was likely to be picked up by other investors quickly.
Billionaire founder Andrew Forrest is currently FMG’s largest shareholder, carrying close to 30 per cent of the company.
A state-owned Chinese steelmaker, Hunan Valin, is the second largest owner, holding a 14.72 per cent stake.
Despite global economic uncertainty investment and merger and acquisition moves in the mining industry remain strong.
A proposed $88 billion merger between Glencore and Xstrata is currently dominating deal making in the sector.