Benfield sale hopes

Benfield Group proved to be a major focal point this week as hopes that the reinsurance broker could be taken over flared up once again.

The company, which is trading around an all-time high of 358p, was in talks with Marsh in 2002, but these discussions failed. Since then, other rivals have been rumoured to be running their slide rules over Benfield, with Jardine Lloyd Thompson thought to be a likely predator.

However, the latest speculation is that Benfield could hold hands with Aon. Traders gossiped that Aon may pay up to 450p a share for the business, but a sticking point would be price, as Benfield believes it is worth more due to higher premiums following last year's hurricanes.

The speculation led to heavy turnover in Benfield shares. During one trading session, volumes reached 4.14 million, well above the usual 1.2 million trades.

Away from the big brokers, Legal & General attracted attention as Keefe, Bruyette & Woods published an underperform recommendation and 115p price target on the stock ahead of new business results.

It said: "In absolute terms we expect the growth rate will be an impressive 21%. But underlying this is a sharp quarterly downturn in its important individual and bulk annuity sales."

' Yvette Essen is stock market reporter and insurance correspondent for The Daily Telegraph