SPECULATION that Newcastle United may return to private ownership has increased after a company owned by chairman Freddie Shepherd bought more shares in the club.

Rumours that the club may be taken off the Stock Exchange grew after a Shepherd family business, Shepherd Offshore, invested £1,187,021 to acquire 5,160,961 ordinary shares.

The latest purchase takes Mr Shepherd's holding in the club to 31,335,318 shares, which represents a stake of 21.57 per cent of the issued ordinary share capital.

The bulk - 30,580,333 - are held in the name of Shepherd Offshore, while the chairman's personal stake amounts to 754,985.

Share prices lifted to 25p after the news was announced, still a far cry from the flotation price of 135p in 1997. Yesterday, the price had dropped to 24p.

The shares were bought from Legal and General, which refused to comment on the sale. A spokesman for Newcastle United played down talk of the club being taken back into private ownership - in the short-term at least.

"Taking the company private has never been discussed at the plc board," he said.

But a Newcastle Utd insider said that while Legal and General had been "required" to sell its shares, "Mr Shepherd was keen to increase his stock".

As well as Mr Shepherd, stock is also held in the club by Douglas Hall, an executive director, who owns 39.5 per cent; eight per cent is owned by Sir John Hall, while the rest of the shares are held by individual retail shareholders including fans and season ticket holders.