U.K. specialty-chemical company Elementis Plc turned down a third acquisition offer in five months, a move that risks further irritating investors who have missed out on potential deals.

Rival Innospec Inc. said Tuesday it is no longer considering an acquisition of Elementis after the latter company’s board rejected a 160 pence per share offer made late last month. Elementis shares pared a gain of as much as 22% to trade up just 1% at 137 pence.

Elementis rebuffed two earlier offers that another U.S. foe, Minerals Technologies Inc., made in November of last year. J O Hambro Capital Management Ltd., a top investor in Elementis at the time, told Bloomberg News it had concerns about management’s strategy and the board’s refusal to enter into discussions with Minerals Technologies. Sky News first reported on Monday that Elementis had
received takeover interest from Innospec.

Eoin Treacy's view

Refusing three takeover offers in the space of a year raises big questions for the current management team at Elementis. They are either going to have to come up with a plan to realise the value these suitors see or fire the CEO and accept an offer. Either way, significant corporate changes lie ahead.

The company is a major producer of surfactants, coatings, chromium and talc and is active in a wide range of sectors. The share completely unwound the initial surge today and a process of mean reversion is increasingly likely.