NEW YORK ( TheStreet) -- Shares of LED equipment makers Veeco ( VECO) and Aixtron ( AIXG) are rising on Friday morning after a Reuters report that LED sector bellwether Cree ( CREE) might make a bid for Aixtron. Several financial news sites -- citing a story from a Reuters European desk -- reported that Cree was considering a bid of 38 euros per share for Aixtron. The report cited anonymous trader sources for the Cree bid, though the original Reuters international report was not immediately available. If it's the case -- and an investor should keep in mind that the LED sector is one in which traders have the reputation of planting rumors to drive trading in shares -- Aixtron was not rising to a level that reflected a 38 euro offer. Aixtron shares were up 3%, to slightly above $40. A 38 euro bid share would value the German LED equipment maker between $49 and $50. Veeco shares were up by more than 2% in early trading, while Cree shares were flat. If anything, the M&A rumors in the LED space highlight the fact that there is a logical thesis to be made for some consolidation. Veeco, in particular, has always been rumored as a takeout candidate, but speculation has usually centered on the big players in the semiconductor space, like Applied Materials ( AMAT) and Novellus ( NVLS). To make a case for Cree buying an LED equipment maker requires some logical assumptions that can be shot down with equally logical counter arguments. Mark Miller, analyst at Noble Financial Group, who has long believed that there is unlocked value in Veeco shares by way of an eventual takeout, says that as the LED market grows cost becomes a more important factor, and players like Cree will pursue each and every opportunity to lower cost. The LED market is transitioning from a period of explosive growth to a more mature market and in this stage of the industry's evolution, the lowest-cost opportunity becomes more important. More and more low cost LED suppliers from Asia, and in particular from China, are expected to join the market. Cree has acknowledged in recent commentary that driving down cost is a major focus for the company.