Home Money Shares shock XP Power as US rival abandons takeover plans after £468m bid rejected

Shares shock XP Power as US rival abandons takeover plans after £468m bid rejected

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Back: Colorado-based Advanced Energy Industries said it has no intention of making a bid for London-listed XP Power

Backtrack: Colorado-based Advanced Energy Industries said it has “no intention of making a bid” for London-listed XP Power

XP Power shares plunged after a US rival abandoned plans to buy the company.

The stock fell 10.1 per cent, or 158 pence, to 1,402 pence after Colorado-based Advanced Energy Industries said it has “no intention of making a bid” for the London-listed group.

The announcement came after the Americans revealed last month that XP Power had rejected three takeover proposals since October, including a final one in May worth 1,950 pence per share (or £468m).

At the time, XP Power called the offers “highly conditional” and “opportunistic.”

The company, which was set up in the UK in 1988 and designs power converters for blue-chip companies, insisted the £468m offer still “fundamentally undervalues ​​the company and its prospects”.

In an update yesterday, Advanced Energy said it has since “tried to engage with XP Power’s board of directors” but complained of a “lack of progress” on pricing.

The American company stated that this has “prevented it from accessing the due diligence necessary to make a firm offer.”

XP Power responded by saying it “has had no contact with Advanced Energy” since its previous offers were rejected.

Russ Mold, chief investment officer at AJ Bell, said: “It’s clear this acquisition deal is a failure.”

The row comes as analysts warn that “relentless” takeover activity on the London stock market amounts to a “frenzy” as potential buyers hunt for bargains.

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