Investors have dumped shares in Vocus after Australia's fourth-biggest telco ended a $2.2 billion bidding war for the company, saying the two suitors were unable to support the buy on the board's terms.
At 1200 AEST Vocus was trading down 52 cents, or 16.15 per cent, at $2.70.
In June, the owner of internet providers dodo and iPrimus received a $2.18 billion takeover proposal from US private equity firm Kohlberg Kravis Roberts worth $3.50 cash per share.
A month later, the takeover bid was matched by Asian private equity firm Affinity Equity Partners.
The bids prompted Vocus' board to allow both parties to conduct due diligence on a non-exclusive basis in order to establish whether an acceptable transaction could be agreed.
On Monday, Vocus chairman David Spence said that while the bidders indicated their support for the management's strategic plans and transformation program throughout the due diligence process, they were unable to support the buy on terms acceptable to the board.
"The process with the bidders has now concluded and the board is looking forward to working with management to deliver improved returns for shareholders over the medium- and long-term future," Mr Spence said.
Management has grappled with a rush to expand that began in December 2014, with a $1.2 billion Amcom merger, a $3.8 billion merger with M2 Group and last October's $807 million acquisition of Nextgen.
Mr Spence said an important factor in deciding to end the sale process with KKR and Affinity was the company's 2018 full-year outlook which forecasts revenue growth to between $1.9 billion and $2 billion, despite cost headwinds associated with competitive market conditions and the migration of customers to the NBN.
"The board is confident that the company can deliver a return to sustainable organic growth following a year of transition in FY17," Vocus said.
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