Pyrrho, a Hong Kong-based investor that has been vocal throughout the bidding process, announced it can no longer support MWB Group’s takeover of the serviced office space provider. Without Pyrrho’s support, the deal cannot get done.

Pyrrho, the second-largest shareholder in MWB Group, pointed to the stock market to explain its stance: MWB’s shares have declined by about 33 percent since the company refinanced. Although Pyrrho could change its mind, a published statement indicates that it is unlikely in the near term.
“Given the massive erosion of shareholder value that this refinancing has caused at MWB Group they would have to come back with a dramatically improved offer for Business Exchange shareholders for us even to begin to be interested,” Pyrrho said in a statement.

MWB Group owns a 72.3 percent stake in Business Exchange, which is the United Kingdom’s second largest provider of serviced office space.

"There is a possibility they [Business Exchange shareholders] will ask for more money. We will have to consider whether we wish to pay it or not,” MWB Group CEO Richard Balfour-Lynn told the Telegraph.

Here’s the backstory: On July 13, Pyrrho signed an agreement to accept a proposed offer from MWB Group. But the Aug. 12 deadline for MWB Group to make its new offer has come and gone, prompting Pyrrho to push for the company to declare its intentions. The deal has declined since then, leaving the door open for Regus to reenter the fray.

Regus was an early suitor of Business Exchange. Business Exchange previously rejected Regus’ offer because “the indicative offer price…would not reflect the underlying fundamental value of Business Exchange in the long term.”

Regus then threatened to withdraw its all-cash £60 million offer for MWB Business Exchange if the stakeholders won’t resume negotiations by June 13. Negotiations stalled, but now that MWB Group can’t get the deal done Business Exchange could turn back to Regus.