An effort by an investment consortium to buy the British water utility Severn Trent fell apart on Tuesday as the two sides failed to enter into talks before a deadline.
The investor group, including the sovereign wealth fund Kuwait Investment Authority and the Canadian fund Borealis Infrastructure, did not come forward with an acceptable offer after earlier bids were spurned, Severn Trent said in a statement. Under British takeover rules, the investor group had until Tuesday to outline an official offer.
Severn Trent had rejected a revised offer of £22, or $34.15, a share, which valued the utility at about $8.2 billion, saying it failed to reflect the utility’s long-term value or future potential.
“We have consistently made clear to the consortium our belief that Severn Trent has a value to our shareholders above the level it indicated it was willing to pay,†Andrew Duff, the chairman of Severn Trent, said in a statement. “This difference in value has been at the heart of this process and the consortium has either not been able, or willing, to bridge that value gap.â€
The investor group had said on Monday that it would walk away from the offer unless Severn Trent entered into discussions. The utility, however, said it would be open to talks if the firms increased their offer.
Shares of Severn Trent fell nearly 4.4 percent in after-hours trading in London on Tuesday, after falling 1 percent during the day.
The investor consortium, known as LongRiver, had made three approaches to Severn Trent, with the latest coming on Friday.
