High street fashion chain Ted Baker lost as much as a fifth of its market value on Tuesday morning after Authentic Brands, the preferred bidder for the company, pulled out of the process.
The company has been in play since March, when US private equity group Sycamore Capital Partners acknowledged it was considering making an offer.
Ted Baker launched a formal auction process at the start of April and although it has not publicly named the participants, it has not been denied reports that Authentic was the preferred bidder.
The privately owned US brand aggregator, which owns Reebok, Nautica and Eddie Bauer among others, declined to comment.
With more than $21bn of annual revenue and backing from large private equity groups such as CVC, Authentic would have had the financial capacity to acquire Ted Baker.
In an update on Tuesday, Ted Baker stressed that the withdrawal was not connected to