Shares in Baan, the troubled Dutch business software group were on a roller-coaster ride yesterday amid fresh speculation that a takeover bid could be on the way.

The shares, which almost doubled in value on Thursday, continued to climb sharply in early trading on the Amsterdam stock market yesterday but then fell back despite the bid rumours.

The latest name to be linked with Baan is that of UK industrial automation group Invensys. The Wall Street Journal described talks between the two companies as "serious" . However both Baan and Invensys declined to comment.

Baan shares have slumped from a high of €49 (£30) two years ago - when it rivalled Germany's SAP as the leading European provider of business software - to as low as €1.16 in recent days. The share price has been undermined by a string of losses stretching back over seven successive quarters and doubts about the company's recovery prospects.

Baan has recruited investment bank Lazard Freres to consider its strategic options but has yet to make any announcement. One possibility could be the sale of its customer relationship management software arm.

On Thursday news that the US software group Oracle could be interested in buying at least part of Baan sent the Dutch company's share price up to more than €3, although many analysts were sceptical about a tie-up.

Yesterday's report sent Baan shares up 14% in the first half hour of trading before it dropped back to €2.40 then recovered to end at €2.80. "Today it's Invensys, yesterday it was Oracle. [Baan] is a very volatile stock," said one trader in Amsterdam. Dealers say the sharp price movements are being driven by demand from retail investors.

Microsoft and the data network equipment maker Cisco Systems have also been tipped as possible suitors for Baan.