* Options trading 4.4 times higher
* Russia's Norilsk known mulling stake sale
* Stock rises 4 percent
(Adds options movement, stock price)
NEW YORK, July 15 Shares in Stillwater Mining
Co (SWC.N) rose more than 3 percent and options trading was
four times higher than usual on Thursday on market talk that
the palladium and platinum miner was an acquisition target.
The sudden surge in interest comes a few months after
Russian metals giant Norilsk Nickel (GMKN.MM) first revealed it
was considering selling its majority stake in Stillwater.
There was no immediate comment from Montana-based
Stillwater, the only producer of platinum and palladium outside
Russia and South Africa.
On a day when the broad market was down and most mining
stocks fell, Stillwater's shares rose 3.83 percent to $13 on
the New York Stock Exchange in afternoon trading.
Overall option volume in Stillwater was 4.4 times greater
than its normal level with about 7,081 calls and 4,898 puts
traded by mid-afternoon, according to option analytics firm
Trade Alert. August Stillwater $14 calls were bought at 65
cents per contract and August $15 calls were purchased at 40
cents apiece. An equity call option conveys the right to
purchase shares at a fixed price anytime until expiration.
"Within the first 30 minutes of trading Stillwater's
bullish call options were bought on expectations that this
palladium and platinum miner would continue its upward move
that started in July," said Pete Najarian, a co-founder of
optionMonster.com, a Web information site in Chicago.
He noted that traders could be positioning for an upside
when quarterly earnings are released on Aug. 6.
"There is also unconfirmed talk of more consolidation in
the sector and Stillwater is one of the names that has been
mentioned," Najarian said.
In April, Norilsk, which owns about 51.3 percent of
Stillwater's common shares, said in a filing with the U.S.
Securities and Exchange Commission it was exploring strategic
options for its stake.
(Reporting by Steve James in New York and Doris Frankel in
Chicago; editing by Gunna Dickson, Bernard Orr)