Puma's over-nine-percent rise kicked off another wave of M&A action on Tuesday, helping drive European stocks to six-year highs.

The FTSE Eurofirst 300 index rose 8.20 points, or 0.5 percent, to 1,548.33, merely two points short of the 1,550.36 high on February 26.

The German sportswear company leapt 9.4 percent to 343.93 euros as a long-awaited bid finally materialized, when PPR, the French luxury goods group, said it had agreed to buy a 27 percent stake in Puma for 330 euros a share and would offer the same amount for the rest of the company.

The offer represents a 16 percent premium to Puma's closing price on April 4, the day before talk of PPR's interest filtered through to the market.

Puma said the transaction was "in the best interests of the company and that the offer price was fair to all shareholders," according to Financial Times.

But Peter Farren, analyst at independent investment firm Bryan Garnier, was quoted as saying that "at 330 euros, Puma is trading at 16.2 times estimated 2007 price/earnings ratio, against [rival] Adidas' 16.4 times."

"An offer of 400 euros a share would be fairer, " the annalist said, pointing to the fact that Puma is expected to have an annual double-digit earnings growth over the medium term.

PPR shares climbed 3.2 percent to 133.03 euros, while Adidas, Puma's rival, rose 2.2 percent to 42.51 euros amid talk that it might become involved in leisure sector consolidation.

In the meantime, the property sector was also in focus after Unibail of France agreed to buy Rodamco Europe in an all-share deal that values the Dutch group at about 11 billion euros, which might create Europe's biggest listed real estate group, with a market value of about 22 billion euros.

Source: Xinhua