Staff at Adecco, the world's largest employment agency, were in mourning today following the death of Klaus Jacobs, the German-born billionaire and well-known philanthropist, who co-founded the Zurich-based firm.

Mr Jacobs, famed for turning the family business into a coffee and chocolate empire and for a $200 million donated to the University of Bremen, died from cancer during the night on Wednesday, his family said yesterday.

He was 71 and had been suffering from the disease for some while.

Adecco has been considering a bid for Michael Page and the news of Mr Jacobs' death sent shares in the UK-based recruitment firm tumbling in early trades today.

Shares fell as much as 19.5p to 290.5p as investors predicted that this could signal the end of a deal, before recovering later to trade down 1p at 309p.

Adecco has until the end of the month to table a firm bid or walk away for six months, under Takeover Panel rules.

Mr Jacobs, born in Bremen in 1936, made his fortune through the sale of Jacobs Suchard to Philip Morris in 1990 for SwFr3.1 billion.

Having co-founded Adecco in 1988, he then turned it into the world's biggest agency of its kind through the 1996 merger of Adia of Switzerland with Ecco of France.

In 2004, Adecco was rocked by an accounting scandal at its US division and was investigated by a number of regulators.

The group came through the crisis but parted company with Philippe Foriel-Destezet, the founder of Ecco and Adecco's other major shareholder.

Both men had lost a fortune as a result of the collapse in Adecco's share price.

Mr Jacobs leaves his second wife Renata, their four children, and two children from his previous marriage.

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