Millennium & Copthorne, the UK hotels group, said it would not be interested at the current share price of 250p, up 12.5p yesterday.
"Now Thistle has been put in play, its shares are trading at a substantial premium," M&C said. "I would have thought something around the float price [170p] would be more appropriate."
Separately, Starwood Hotels and Resorts, an American group, also backed off. "We've taken a look at it but we're not pursuing it," the company said.
Thistle announced on Tuesday that it had received approaches that could lead to an offer for the group. It is understood that there are at least three potential suitors, including trade and financial buyers from the UK and overseas.
One of the attractions of Thistle is its strong portfolio of London hotels. Analysts say US investment trusts could be attracted by the property assets. Thistle's London hotels include the Tower Thistle, by Tower Bridge, and The Mount Royal, near Marble Arch.
Brierley Investments holds a 46 per cent stake in the company but is reviewing its portfolio and may be interested in selling its holding. Thistle is currently valued at pounds 1.5bnReuse content