DSGi was the week’s biggest riser as talk spiralled about a likely disposal of its Spanish business and troubled Italian chain UniEuro, encouraging short sellers to close their positions.

However, analysts were unconvinced that deals would be satisfactorily consummated.

Pali International’s Nick Bubb warned: “If anybody thinks DSGi could get a good price for UniEuro they should think again. UniEuro is losing a lot of money and has no significant freehold assets and there is no obvious trade buyer.”

He fears that DSGi might have to pay a buyer£300 million to take UniEuro off its hands.

JP Morgan’s Simon Irwin said, rather than selling Spain and Italy, “DSGi may have to invest in them to close or restructure”.

Panmure Gordon’s Philip Dorgan said: “Getting rid of loss-making and potentially haemorrhaging overseas businesses would be good for sentiment, if slightly more tricky to deliver than newspaper reports may suggest.”

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