Dec. 24 (Bloomberg) -- Cap Gemini SA rose the most in almost five years in Paris trading after the Hindustan Times reported that India's Wipro Ltd. may offer to buy Europe's largest computer-services company for as much as $7 billion.

Cap Gemini isn't in talks with Wipro about a takeover, the Paris-based company said in an e-mailed statement after the market closed. The shares climbed 4.29 euros, or 11 percent, to 45 euros, the biggest advance since February 2003. Wipro gained the most since May 2004 on the Bombay Stock Exchange.

Cap Gemini, led by Chief Executive Officer Paul Hermelin, in February bought Houston-based Kanbay International Inc. for $1.25 billion, doubling its Indian workforce. Bangalore-based Wipro, India's third-largest software services exporter, may bid for Cap Gemini by the end of January, the Hindustan Times newspaper reported yesterday, citing ``investment banking sources.''

``There's arguably a super merger to do between a large Indian and a large European player,'' said Jonathan Crozier, a London-based WestLB AG analyst who has an ``add'' rating on Cap Gemini shares. ``Big Indian outsourcing companies haven't really moved into Europe. In the end you need to have on-shore client relationships.''

Wipro may offer ``close to'' 48 euros ($69) a share, the newspaper said. That would value Cap Gemini at as much as $7 billion, the newspaper said. Reuters, citing unidentified people, reported on Nov. 10 that Wipro planned to bid 60 euros a share for Cap Gemini.

Too Low

``You would need a higher price than 48,'' said Crozier, who has a price target of 56 euros on the stock. ``Cap Gemini traded at 59 euros in April this year, so 48 euros looks a bit opportunistic.''

Radha Radhakrishna, a spokeswoman for Wipro, declined to comment on the newspaper report. Christel Lerouge, spokeswoman at Cap Gemini, didn't return a call for comment.

The Hindustan Times report is only the latest to speculate that Cap Gemini may be acquired by an Indian company. The Times of India reported in July that Infosys Technologies Ltd. was in talks with at least four companies, including Cap Gemini.

``For several weeks, the desire to launch a takeover bid for our company has been attributed to one or another Indian player,'' according to a statement from Philippe Grangeon, a member of Cap Gemini's executive committee. ``As with the other rumors, we affirm on the one hand that there is no conversation of any sort with the Indian player who is named as a possible bidder. On the other hand, we affirm our conviction that any hostile takeover in this sector is doomed to fail.''

Sales Growth

Hermelin said in September that sales growth at Kanbay would exceed 15 percent this year. Kanbay's clients include HSBC Holdings Plc, Europe's largest bank by market value, and Morgan Stanley.

Cap Gemini shares have fallen 5.4 percent this year. Before today, the Dow Jones Stoxx 600 Technology Index was up less than 0.1 percent this year.

Wipro gained 8.9 percent to 535.3 rupees. Wipro and rival Infosys Technologies Ltd. were also helped by news that U.S. consumer spending increased last month, easing worries about a slowdown in the computer services providers' biggest market.

To contact the reporter on this story: Marcel van de Hoef in Amsterdam at mvandehoef@bloomberg.net

Last Updated: December 24, 2007 09:13 EST