Shares in retailers Hering and Arezzo jump after merger proposal is rejected

SAO PAULO, April 15 (Reuters) - Shares in Brazilian apparel retailer Cia Hering soared more than 25% in morning trading after it rejected an unsolicited merger offer from competitor Arezzo Industria e Comercio SA.

Shares in Arezzo jumped almost 8%, even though its offer was rebuffed.

Arezzo offered 3.28 billion reais ($582.61 million) for Hering, implying a 20% premium to the current price of its stock, in a cash and stock deal.

Amid lockdowns that have forced stores to close in an effort to contain the spread of the coronavirus, some retailers have been considering tie-ups. Brazil has the world's second deadliest coronavirus outbreak.

In a note to clients, Credit Suisse said Hering shares were likely to react positively to the offer, as the company would be seen as a merger and acquisition target.

Analysts at Guide Investimentos said Arezzo's move showed it continues to have appetite for new acquisitions, which is positive. ($1 = 5.6298 reais) (Reporting by Paula Laier; editing by Jonathan Oatis)