Seven up amid talk of Telstra takeover

TV companies deny rumors, but Stokes' stock surges

By MARK WOODS

SYDNEY -- Shares in Kerry Stokes Seven Network surged 7% to A$7.87 ($4.65) Friday amid rumors that public telco Telstra was preparing a $5.47 a share bid for Oz's No. 2 web.

While Telstra and Seven vehemently denied the rumors, the talk pushed Seven's market capitalization to $1.18 billion. Any takeover bid would require the cooperation of either Stokes or the U.K.'s Granada, which have stakes of 36% and 11%, respectively, in the web.