Bodycote Group (LSE:BOY), the thermal processing and heat treatment specialist, saw its shares drop 9% to 751p after private equity giant Apollo Global Management confirmed it does not intend to make a firm offer for the company.
Apollo had revealed a conditional proposal for Bodycote on 22 May 2026, sparking speculation that the group, which provides specialist engineering services to the aerospace, automotive and industrial sectors, could be taken private.
The US buyout firm said it continued to hold Bodycote and its management in high regard and thanked the board for engaging with the proposal, but gave no reason for its decision to withdraw.
Under the Takeovers Code, Apollo is now prohibited from making another approach for six months without Panel consent, unless one of a standard set of exceptions applies, including a recommendation from Bodycote's board, a rival bid from a third party, or a material change of circumstances.
Apollo also reserved the right to acquire Bodycote shares in the market, subject to applicable regulations.
The 9% fall reflects the unwinding of the takeover premium that had built into the stock since Apollo's approach was made public, a familiar dynamic when a potential acquirer steps back.
Whether a rival bidder emerges within the six-month window remains to be seen, but Apollo's explicit reservation of its right to return under certain circumstances will likely prevent the premium from fully collapsing in the near term.
