Credit default swaps on airports operator BAA spiked higher on Tuesday, but trading was thin in the European credit market, with few headlines to spur activity after a four-day Easter break.
The cost of credit protection on BAA rose briefly, before falling to trade unchanged, after the British airport operator rejected a 9.4 billion pound take-over approach from investment bank Goldman Sachs.
BAA, which owns London's Heathrow, Stansted and Gatwick airports, is also fending off an 8.75 billion pound hostile bid from Spanish construction firm Grupo Ferrovial.
"What's changed? It's just another failed bid," a trader in London said.
Five-year credit default swaps on BAA rose as much as 8 basis points, before falling back to an unchanged 58 basis points.
Goldman has not released details of its partners in the consortium, but a source familiar with the situation said on Tuesday that Insurer American International Group Inc was involved, confirming a report in the Daily Telegraph newspaper. But the source played down a separate report that General Electric Co might also be involved.
A source close to Goldman Sachs said the bank's chief executive Hank Paulson had told the firm to think carefully before using its own money to finance hostile take-overs after a backlash against its role in a series of UK deals.
Elsewhere, traders of VNU's debt awaited news from the market research firm's shareholders' meeting in Amsterdam on Tuesday afternoon.
VNU wants to persuade investors at the extraordinary meeting that a sale of the world's largest market research firm is a better option than a break-up or an independent future.
The most vocal investor, Knight Vinke Asset Management, which holds about 2 percent of VNU, vehemently rejects the bid and is urging other investors to do the same.
Fund management giant Fidelity International, which owns about 15 percent of VNU, signalled last month it was unlikely to support the offer.
A buyout group that includes private equity firms Kohlberg Kravis Roberts & Co, and Carlyle Group has offered 28.75 euros a share for Netherlands-based VNU. The bid, which expires on May 5, is conditional upon 95 percent shareholder approval, but analysts doubt it will succeed.
Five-year credit default swaps on VNU were unchanged at 155 basis points before the investor meeting, the trader said.
The FTSE Euro Corporate Bond Index showed investment-grade corporate bonds in euros yielding an average 47.1 basis points more than similarly dated government bonds at 1444 GMT, 0.7 basis points lower on the day.
"Absolutely nothing's traded - the market's incredibly thin, and most people are still away for Easter," said one index trader in London. "Bar the days between Christmas and New Year, this is as quiet as it gets."
The iTraxx Crossover index, used as a benchmark of sentiment in the high-yield market, rose 3 basis points, bid at 270 basis points, the index trader said, pressured by rising oil prices and weaker US equities, but few if any trades went through.