First Group, the London-listed transport firm which owns brands such as South Western Railway and Greyhound, revealed this afternoon that it has rejected an "opportunistic" bid from private equity firm Apollo.
Though it did not disclose the size of the offer from the New York-listed giant, First Group said the bid "fundamentally undervalues the company".
Apollo now has until 9 May to make a firm offer – which could see it up the price to convince the board, or turn hostile in an attempt to woo shareholders directly – or back down.
The offer sent First Group's market value steaming ahead, as the company which also owns Great Western Railway and the Transpennine Express saw its share price shoot up by more than seven per cent at the close.
Apollo, which had $249bn (£176bn) in assets under management at the end of last year, has made a number of investments in the UK in the past.
It currently owns troubled jewellery retailer Claires, and helped property services company Countrywide list on the London Stock Exchange in 2013.
First Groups share price has been on a steady decline over the past year, taking a particular hit in February after the company reduced its earnings outlook blaming "challenging" weather in North America and intensifying competition for Greyhound.