trading halt

SYDNEY, Dec 8 (Reuters) - Australian automotive parts retailer Repco Corp. Ltd. (ASX: RCL.ax) , whose share price has been buoyed by takeover talk, put its shares on a trading halt and said it expected to make an announcement on Monday.

Talk of a takeover of the underperforming group has swirled in the market in recent months, but its shares jumped 9 percent on Thursday after rumours of a bid at A$1.60 a share, the Australian Financial Review reported.

Dealers said market talk centred on a potential bid by private equity group Archer Capital, which helped float Repco three years ago.

Archer had previously been seen as a likely bidder after it briefly built up a 6.5 percent stake in Repco, although that speculation cooled when it made a A$369 million ($291 million) agreed bid for Rebel Sport Ltd. (ASX: REB.ax) last month.

Archer partner James Carnegie declined to comment when asked whether Archer was planning a bid for Repco.

Repco's fiscal 2006 profit fell 43 percent to A$20.8 million ($15.9 million) as high petrol prices hurt spending on car parts, but its sales improved in the first quarter of fiscal 2007.

"They've still got a bit of work to do, but their first quarter showed some improvement. I think they are doing the right things," said David Spry, analyst at FW Holst & Co. "From that point of view the timing's not too bad."

Chief Executive Graeme Yeomans, who took over the top job in July, said in October he was pleased with the overall direction of the business, which has a market capitalisation of about A$276 million.

Shares in Repco, which has 453 stores in Australia and New Zealand, first floated at A$2.52 a share, but fell sharply this year to a low of A$0.84. The stock last traded at A$1.44.

The company was floated by a private equity consortium, comprising Archer, Macquarie Direct Investment and Gresham Private Equity, which bought it from former conglomerate Pacific Dunlop.

Repco's main rival is Super Cheap Auto Group Ltd. (ASX: SUL.ax) , which has auto parts and leisure activity stores. ($1=A$1.27) (Additional reporting by Denny Thomas)