UK newspapers said on Monday that Mr Montgomery had already signed financial agreements with UK and US banks and private equity firms to launch an agreed cash offer for Mirror at 270p per share.

Mirror shares closed at 244.5p on Friday on the London Stock Exchange.

Mr Montgomery was forced to quit in January, having been chief executive of the group for more than six years.

He is believed to have drawn up plans which would see a faster movement of the Mirror Group into electronic media, including the Internet.

Mirror Group has already had bids from regional newspaper groups Trinity and Regional Independent Media.

Fiat quiet on DaimlerChrysler

Italian car maker Fiat declined to comment on a DaimlerChrysler official's disclosure that the German-American group is interested in acquiring it.

Juergen Hubbert, in charge of DaimlerChrysler's automobile operations, told 'Die Welt' newspaper that DaimlerChrysler was interested in Fiat, but that a merger was unlikely soon.

"We've seen that the Fiat owners in reality don't even want to sell yet," he was quoted as saying.

The Agnelli family, which controls around 30% of Fiat via holding companies Ifil and IFI, has indicated it is not against a major alliance, but that there will not be any outright sale of the company.

Shares of Fiat-related stocks rose for most of last week following Fiat's centennial anniversary celebration and the unveiling of a new Punto compact car.

ONdigital boss rejects Murdoch

The former boss of ONdigital, Stephen Grabiner, who quit on Tuesday as head of the UK digital television company, said he was not going to work for Rupert Murdoch, owner of the rival BSkyB digital satellite TV company.

Mr Grabiner had initially said he would be joining eVentures, a venture capital firm backed by Mr Murdoch and the Japanese Internet investment company Softbank.

But now he says he will take a job at British venture capital firm Apax instead.

Boost for US industry

US industrial production rose by 0.2% in the month, in line with analyst expectations. The manufacturing sector is experiencing something of a revival as the recovery in export prospects, especially in Asia, has boosted output.

But capacity utilisation, a measure of how much extra margin there was to boost production, remained steady at 80.3%, indicating that there was no squeeze that could lead to higher prices.

UK pay settlements fall

Pay settlements in the UK engineering industry fell to the lowest level in five years.

A survey by the Engineering Employers Federation showed that the average pay settlement for the three months to June was 2.5%, down from 2.7% in the previous period.

One in five deals actually involved a pay freeze.

"These latest figures show that engineering companies are continuing to manage their controllable costs .. and that wage inflationary pressures in our sector are benign," said David Yeandle of the EEF.