The asthma inhaler producer Bespak announced yesterday that it had ended takeover discussions with several companies, reputedly including HG Capital.
The proposed bids for the company, which supplies products to pharmaceutical companies such as Glaxo and Schering-Plough, were discussed after it issued a series of profit warnings this year.
Analysts expect Bespak profits to fall from £15m in 2002 to £4.2m this year.
Although the offers were at a significant premium to Bespak's current value of £94m, its chief executive, Mark Throdahl, believes that "the bids offered did not reflect the excellent growth prospects of the business, which has already been improving since March".
Yesterday's statement, which was accompanied by news that trading for the first quarter of the latest financial year was ahead of expectations, pleased the stock market, which marked the shares up 45p to 387p.
Sebastian Jantet, an analyst at Investec, commented that "if the company can afford to walk away from bids rumoured to be worth 400p a share [which would value the group at about £108m] then they must be quite confident of larger profits on the horizon".
Mr Throdahl said he saw one of the group's new products, Exubera, an insulin product that can be inhaled by diabetics, as a potential "pharmaceutical blockbuster".