A surprise bid for online auction site Trade Me has thwarted what was likely to have been a big fall for the local sharemarket following on from Wall Street's sharp decline overnight.
Trade Me said it had received a preliminary, non-binding, indicative proposal from a company called Apax Partners to acquire 100 per cent of Trade Me at a cash price of $6.40 per share - a 25.5 per cent premium to Tuesday's closing price of $5.10.
The indicative proposal is subject to a number of conditions, including the completion of due diligence.
Shares in Trade Me - a constituent of the NZX50 index - rallied by 96 cents or 18.8 per cent to $6.06 on the back of the news and by 10.35 am the index qas down by just 0.3 per cent at 8691.
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In contrast the Dow Jones index closed at 24,465.64, down 551.80 points or 2.2 per cent, as weak results from retailers and mounting losses for big technology companies pushed the market back into the red for the year.
Energy companies were also weak on the back of a 7 per cent plunge in the price of oil.
Mark Lister, head of private wealth research at Craigs Investment Partners, said the market would have been looking at a much sharper decline had it not been for Trade Me's announcement.
"That is cetainly offsetting broader weakness as a result of overnight moves on US markets," he said. "It's not a bad start today for the local market."
Among the other moves, Fletcher Building rallied by 7c to $5 after Tuesday's share decline, while a2 Milk dropped by 25c to $10.10.