Investors in Informa, the publishing and events group, expressed mixed feelings yesterday after its board rejected the latest private equity bid. There was nothing mixed about the reaction on the market, however, the shares slumping 28¾p, or nearly 7 per cent, to 385¾p.

The private equity consortium, made up of Providence Equity, Carlyle and Blackstone, offered 450p. There were fears that the stock could plummet farther if they did not return with a higher offer.

The board said that it had rejected the offer, which values the company at £1.9 billion, because it was significantly less than the consortium’s previous proposal of 506p a share.

However, sources close to the consortium said that it would have difficulty raising its offer significantly. A source said: “Even meeting somewhere in the middle – at about 480p – would be a big jump. It was a miracle that the deal got funding at this level in the current market.”

In an announcement to the Stock Exchange, the consortium said it was disappointed by Informa’s decision and that it was considering its position but there was no certainty it would be prepared to make another offer.

One of Informa’s top ten shareholders said that, without the prospect of a bid, Informa could be dragged down by a continually weak media sector. He said: “Informa rejected a 630p-per-share offer in November 2006. Now they have rejected 450p. Will the next offer they reject be at 270p?”

However, there was some support for the board’s decision, with one of Informa’s top three shareholders saying that it “fully backed” the directors’ decision.

The FTSE 100 lost more than 2 per cent for the third day in succession on continuing fears about the state of the global economy. The index fell 121.4 points to 5,240.7, taking its weekly fall to nearly 7 per cent, the worst weekly performance for more than six years. Markets globally were rocked after figures showed that the unemployment rate in America rose to its highest level in five years and Nokia, the world’s largest mobile phone maker, gave warning of weaker markets.

Concern about the economy hit banks, with Barclays falling 12p to 317¼p and Royal Bank of Scotland 8p lower at 219¾p.

Miners also fell on fears of lower demand and falling metal prices. Kazakhmys lost 86½p at 975½p, Ferrexpo was down 14p at 184p and Antofagasta was 38p lower at 502½p.

RSA Insurance led the index, up 4½p to 162.8p, on continuing bid speculation, with Allianz, which agreed this week to sell its Dresdner unit to Commerzbank, the latest name linked to a possible offer. Generali and Zurich Financial have also been cited by traders as potential bidders.

Johnston, Matthey was the heaviest faller, off 134p at £14.41, after Merrill Lynch downgraded it to “neutral”, from “buy”, citing a worsening situation in the car and truck markets.

In the FTSE 250 JD Wetherspoon, the pubs group, rose 7½p to 268½p, after its annual results were no worse than feared.

— New York: Stocks slid on news that US unemployment had reached a five-year high, but recovered on bargain-hunting among financial stocks. The Dow Jones industrial average closed up 32.7 points at 11,221.00.

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