Darktrace shares plunged by a third after a private equity suitor confirmed it would not make a bid for the UK cyber-security specialist.
Last month, US tech-focused firm Thoma Bravo confirmed it launched talks with Darktrace over a potential cash takeover.
Darktrace was valued at around £2.7 billion at the time of the takeover speculation.
However, on Thursday, Darktrace told shareholders “an agreement could not be reached on the terms of a firm offer”.
Thoma Bravo is unable to return to the table with a takeover approach for the next six months, in line with UK takeover rules.
Darktrace's share price is doing some rather convincing impressions of Wile E Coyote plunging down a canyon so far this morning. pic.twitter.com/oY5xdtiuXW
— Gareth Corfield (@GazTheJourno) September 8, 2022
ShadowFall, a hedge fund which has been critical of Darktrace and bet on the stock sliding, said Thoma Bravo’s decision to end its interest vindicated its belief that the company was overvalued.
Darktrace shares plunged 33.5% lower to 342.4p during early trading.
It came as the cybersecurity firm – whose founder Mike Lynch is facing extradition to the US over fraud charges – hailed strong revenue growth and held firm on recent financial targets.
The group said revenues increased by 45.7% to 415.5 million dollars (£361 million) over the year to June compared with the previous year.
It said it benefited from “growth across all geographic markets and customer sizes”.
Operating expenses were also below typical levels during the year but are now expected to increase, it added.
Meanwhile, Darktrace recorded earnings of 63.8 million dollars (£55.5 million) for the year, compared with 6.5 million dollars (£5.6 million) the previous year.