Mexican pharmaceutical products company Genomma Lab (LABB.MX) said on Thursday it will drop its offer for Prestige Brands Holdings Inc (PBH.N), after Prestige rejected the offer.
Genomma stock was up 9 percent in afternoon trading. Shares in the company had fallen more than 15 percent since February 21 after it announced its plans to take over the healthcare and household cleaning product brand.
Genomma's offer of $16.60 in cash per share for Prestige Brands was a premium of 23 percent over the company's closing price on February 17, the last close before Genomma made its offer.
Prestige Brands said in March Genomma's proposal was "inadequate.
Genomma said in a statement to the Mexican stock exchange, that it had secured $2.2 billion in financing for the deal and fulfilled the necessary requirements.
But Genomma said Prestige rejected the bid late on Wednesday and would only negotiate if the Mexican company "significantly increased their offer."
Prestige Brands said in a statement later on Thursday that it is still "open to considering offers that would create compelling value for stockholders."
Shares of Prestige, which sells brands including Comet cleaning products and Clear Eyes contact lens solution, were down 16 percent at $13.85 in afternoon trade on the New York Stock Exchange. (Reporting by Mica Rosenberg in Mexico, Arpita Mukherjee in Bangalore; Editing by Gerald E. McCormick and Supriya Kurane)