Heath Lambert walks away from JLT's £135m merger bid
Jardine Lloyd Thompson's (JLT) share price plunged to 334p after Heath Lambert pulled out of merger talks this week.
JLT's share price had soared to a high of 401p on initial reports of a possible £135m bid for the rival broker.
The share price then nose-dived to 334p when the deal collapsed during due diligence.
Heath Lambert chief executive, Adrian Colosso, said: "As discussions progressed we became less confident that we would be able to continue with this model, and therefore less confident of achieving the objective.
"Proceeding would not have been in the best interests of our staff or our clients."
The announcement led to a frenzy of speculation that an international broker such as Aon could attempt its own takeover bid for Heath Lambert.
Willis has been named as a possible suitor for JLT. Heath Lambert is thought to have earlier rejected an approach from Willis in favour of JLT.
Towergate has also been mooted as a potential bidder for Heath Lambert.
But sources close to the company said Towergate would be "uninterested" in buying the broker because the business models are incompatible.
"Towergate is more into niche areas rather than the more general side of insurance," the source said.
"It would more likely look to attract some of the teams who might be ready to move on."
Another source said: "Colosso will do whatever he wants to do. By being quoted as saying that they have 'pulled the plug' on the deal he has been quite provocative and made JLT look a bit foolish."