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We’re redrawing our pages a bit this afternoon to accommodate the news that Sir Michael Rake, chairman of KPMG International, will succeed Sir Christopher Bland as chairman of BT. He will take over in September and, on present form, will find the group in good health. We’ve already got a first take on the story up online from Andrew Parker but we’ll have plenty more to tell you about the man and the task he faces later. For now let me just say that, despite the fact that he is a keen polo-player, we have always found him quite straight-talking – and comes across as much less aloof than Sir Christopher. He is even an occasional a blogger. Who wants a bet on how many times “Rake’s Progress” pops up in headlines tomorrow?

It has also emerged this afternoon that Polygon, the hedge fund that has proved troublesome to many a bidder (for Telent, Countrywide, Teesland), holds derivatives representing 1.54 per cent of J Sainsbury shares.

J Sainsbury shares have been moving again today on hopes of a bidding war. I’m afraid I think those hopes are misplaced. The idea that Stuart Rose is going to team up with the Qataris is fanciful. And the idea that he will lead M&S into a bid of its own for Sainsbury’s is also far fetched. For all the apparent attractions (especially to bankers) of putting two such well-respected names together and rolling out the M&S magic across more stores, bidding for Sainsbury’s would be fraught with risk for Rose. M&S is just beginning to show genuine signs of recovery but Rose has plenty more to do. If he keeps going for two years he will be a hero and probably a knight. If he bids and loses, he will have exposed a strategic weakness. If he bids and succeeds, the execution risk is, to say the least, asymmetrical.

For a start, Sainsbury’s shares – on 36 times prospective earnings – reflect a recovery that hasn’t yet taken place, whereas the opposite is arguably true for M&S shares. Also, Rose’s deal experience is mostly as a vendor, not a buyer and integrator of businesses. Rolling out the M&S magic just across M&S is hard enough, without trying to do it across Sainsbury as well and risking taking M&S down market. The only other compelling motivation might be defensive. Yet it’s hard to see that, after it had been bought by a private equity consortium, a heavily-indebted Sainsbury’s would be a fiercer threat to M&S. The opposite is probably true. Neil Hume and Paul Murphy have also had a look at these rumours on FT Alphaville.

Otherwise, our newslist is dominated by talks over some interesting mid-sized deals. Leading the list is Kensington Group, the sub-prime mortgage lender suffering from competition from larger banks such as Lehman and Merrill.

It says it has noted “the recent press speculation about third-party interest in the business and confirms that it is continuing its review of the group considering the best options to maximise shareholder value.” Translated, this means it’s on the block but it’s still early days. The shares are up 9 per cent – still below where they were before November’s profit warning but way above where they were when takeover talks with Lehman collapsed two years ago.

Enterprise, the support services group, confirms it is in talks with 3i about an offer at 605p a share, which is higher than the 575p approach we reported on the other day. and it’s all go again in uranium: UraMin shares, listed on Aim and in Toronto, jumped almost 10 per cent this morning after the group in effect put itself up for sale. This came a week after UrAsia Energy and Uranium One, two other Canadian listed uranium miners, agreed a $2.9bn merger.

Amec’s punchy new chief executive, Samir Brikho, has done his first deal, selling the group’s 50 per cent stake in a French rail joint venture. It’s not a huge deal but he has promised much, so let’s hope it is the beginning of something more exciting.

We’ll do more today on our scoop this morning about the LSE lowering the spread on seven FTSE 100 stocks. The impact on large firms will be mitigated by an increase in trading volumes but smaller brokers could suffer.

Rumour of the day Shares in Hammerson, the property group, are up 1½ per cent on rumours Neil Hume is picking up that it might be in the sights of a French company called Unibail (Hammerson has lots of French assets) or private equity.

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