TT Electronics PLC (LSE:TTG) shares fell over 20% to 105p after DBay Advisors said it is no longer considering making an offer for the company.
Last week DBAY said it was considering a possible offer and was given a put-up-or-shut-up deadline of 5pm today (Monday 15 December).
TT's board has recommended an offer from Swiss group Cicor Technologies, which includes options for investors to take 150p in cash or a cash-and-shares combination.
DBAY, which has a stake of around 16.5%, said last week and repeated today that it "continues to believe that the terms of Cicor's offer...are unattractive, and therefore intends to vote against the scheme of arrangement".
TT Electronics has accused shareholder DBay of having a "different agenda" in its decision not to back the planned £287 million takeover, having had several bids rejected in recent months.