STOCKS NEWS EUROPE-FLSmidth rises 3 pct on sector's M&A fever

Shares in Danish engineering company FLSmidth rise 4.3 percent, boosted by consolidation hopes in the sector.

Finnish engineering group Metso (Dusseldorf: VLM.DU - news) , a rival of FLSmidth, says Scottish Weir Group has proposed discussions over a potential merger between the groups and that Metso is considering the proposal.

Metso stock is up 18.8 percent, while Weir stock is down 2.8 percent.

"It brings a general positive impact on an industry who lately has been under a lot of pressure," Sydbank (Copenhagen: SYDB.CO - news) analyst Jacob Pedersen says.

Two years ago, Weir Group (Frankfurt: 42W.F - news) and FLSmidth fought to take control of Australian coal mining company Ludowici - a battle FLSmidth ultimately won, even though it later had a write-down of 800 million Danish crowns ($147.68 million) related to the acquisition.

FLSmidth's stock has fallen 19 percent over the past 12 months, underperforming a 31 percent rally in the Danish benchmark index OMXC20CAP over the same period.

Reuters messaging annabella.nielsen.thomsonreuters.com@reuters.net

($1 = 5.4170 Danish Crowns)