A COACH builder is in talks over a possible takeover just two months after floating on the stock exchange, company chiefs have confirmed.

Darwen Holdings is the parent company of the Darwen Group, the firm which took over East Lancashire Coachbuilders based in Whitebirk Industrial Estate, Blackburn, last August.

Chief executive of Darwen Holdings, Andrew Brian, revealed that the company was discussing potential takeover options with Jamesstan Investments Ltd, owner of fellow bus builder Optare.

Darwen Holdings floated on the Alternative Investment Market (AIM) of the London Stock Exchange in March, but shares were suspended at the start of May as rumours grew over the future of the company. Mr Brian said: "Optare is a very highly regarded brand within the industry and the deal we are discussing would present a very exciting opportunity for us, our shareholders, and all related parties.

"The deal is in line with our strategy to grow Darwen through acquisition, alongside the organic progress we've made over the past year, and we look forward to updating the market in due course."

Darwen Group bought East Lancashire Coachbuilders and North West Bus and Coach Repairs, Appleby Street, in a multi-million pound deal in August 2007 after the firms went into administration. About 270 staff are employed between the two sites.

Any deal with Jamesstan Investments Ltd would be classed as a reverse takeover under AIM rules. This is where a smaller company takes control of a larger firm and in doing so often has to reorganise their finances to facilitate the deal.

Darwen Holdings specialises in the design, assembly and supply of single and double-deck vehicles to bus service operators in the UK.

At the time of the suspension of shares they were trading at 44 pence each.