Advanta Corp.'s stock rose sharply Friday amid rumors the eighth- largest credit card issuer had found a buyer.
Advanta's A shares rose $1.625, to $31.125, by early afternoon, while its B shares jumped $1.50, to $29, on a day when bank stocks were soaring. The firm has been working since last summer with acquisitions specialist BT Wolfensohn and is thought to be worth at least $1 billion.
An analyst at Duff & Phelps Credit Rating, James E. Moss, said the number of suitors courting Advanta had been whittled to one, and a price was being negotiated. "It could happen tomorrow, it could happen in two months or longer," Mr. Moss said. "It's going to take the right price, the right structure."
Reports that National Australia Bank was a potential acquirer circulated wildly early in the summer, but the negotiations were said to have stalled over price.
Mr. Moss and other analysts said the urgency with which Advanta had been seeking a buyer at the beginning of the year had waned as the company's financial circumstances had improved.
"There's no hammer hanging over Advanta's head," Mr. Moss said. The company has demonstrated, he said, that it could "go on business as usual" until it finds the right suitor.
An Advanta spokeswoman, D'Arcy Foster Rudnay, declined to comment. "We are still in the process with Wolfensohn to explore our strategic alternatives," she said.
Van B. Hesser, a fixed-income analyst at Goldman, Sachs & Co., noted the price of Advanta's A shares had ballooned to $37 over the summer, when takeover rumors were at their thickest. Since then, he said, the price has sagged and "Advanta once again looks affordable."
Elsewhere in the market, shares of PaineWebber Inc. surged as a result of rumors that Goldman Sachs was about to buy the company.
A Goldman Sachs representative denied the company is in talks with PaineWebber. PaineWebber declined to comment.u