According to St Ives, the proposal was rejected for three reasons: the offer price of 272.5p per share undervalued the firm; the "stub equity component" of the proposal was uncertain because of the highly leveraged deal; and the debt burden that the deal would put on the business would place it and its growth at risk.

St Ives chairman Miles Emley said: "As a board, we are unable to see a benefit to St Ives' shareholders of combining these two businesses as envisaged by Tangent."

The rejection follows a presentation from Tangent which, according to St Ives, mainly focused on point-of-sale and direct mail operations.

"But [the presentation] set out no significant new plans for the development of these businesses that are not already being implemented," said the St Ives statement.

The discussion followed the announcement earlier this week that Tangent was behind the bid approach, first announced last month, for St Ives.

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