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Home Depot Rises on Takeover Speculation

Shares of Home Depot rose following published reports that private investors could be circling the home improvement store chain for a huge leveraged buyout.

Deutsche Bank Securities analyst Mike Baker in a client note said private equity investors could give current shareholders a premium price while still earning good returns with a Home Depot buyout.

For example, the buyout shops could pay $45 per share, the analyst wrote, giving shareholders about a 20 percent premium to Thursday's $37.97 close on the NYSE. His target price on the stock is $44.

In a Thursday story on its Web site, The New York Post said private investors, including Kohlberg Kravis Roberts & Co. and Texas Pacific Group, are considering a $100 billion buyout of Home Depot.

The $100 billion price tag sounds "amazing," wrote Baker. Home Depot in 2005 booked profit of $5.84 billion on $81.51 billion in sales, according to Thomson Financial.