If any reminder was needed of the volatility of shares in the staffing sector, it was demonstrated once again during the past two weeks.

After analyst Kean Marden, head of research at Singer Capital Markets, picked up on marketplace rumours mentioned in Recruiter, 18 March, that Adecco was eyeing up SThree as a possible acquisition target, trading volumes in SThree shares rose dramatically. On 20 March, SThree’s share price jumped 8.5p in the first hour of trading to 190p, though it subsequently drifted down to 168p on 25 March.

Despite calls by Recruiter to both companies neither has been able to confirm or deny whether there is any substance behind the rumours.

Marden told Recruiter there were good reasons why SThree would make an easier transaction for Adecco to conduct than its failed bid for Michael Page last year.

“If you want to buy a company, it’s good if you get what are called irrecoverables — the agreement of the management team. This sends out a powerful message to the shareholders that the terms of the deal are attractive,” Marden explained. “If the management team owns 25% [as is the case with SThree], that’s a more powerful message from a team that owns 2% [as was the case with Michael Page].

“I just feel they [Michael Page] were happier as an independent company rather than a subsidiary of another group,” he added, referring to the company’s experience as a Spherion subsidiary between 1977 and 2001.

Specialist Adecco analyst at Helvea Equity Research in Switzerland, Chris Burger, told Recruiter: “I think it’s clear Adecco is looking for bolt-on acquisition in the specialist staffing area, and an acquisition of SThree would fit in with this strategy.”