Fidelity Investments, which is already the majority shareholder in Colt Group, has bid to acquire the remaining stock of the telecoms and cloud provider, but Colt directors are unconvinced.

The relationship between the two companies is intimate and has been from the very beginning. Fidelity provided the cash to form Colt back in 1992, to provide telecoms services in London. It soon expanded across Europe but in 2001, together with a lot of other telecoms and tech companies, encountered problems requiring a further injection of capital from Fidelity.

For some reason, despite holding its current majority position since then, Fidelity has decided it’s time for Colt to be wholly private once more. “As founders and majority shareholders of Colt, Fidelity is pleased to announce the continuation of its commitment to the business through returning the group to private ownership,” said Cyrus Jilla, President of Eight Roads, the proprietary investment arm of Fidelity.

“We typically hold our proprietary investments outside the financial services industry, such as Colt, in the private domain. This transaction allows us to hold our investment in Colt consistent with this strategy while providing an attractive and certain value for the current Colt independent shareholders.”

The independent directors of Colt, who are there to protect the interests of its shareholders, have publicly acknowledged the offer of 190p per share from Fidelity, but reckon it’s too low.

“The independent directors believe that the offer undervalues the company and its prospects and accordingly they consider that the financial terms of the offer are not fair to the independent shareholders of Colt,” said their statement.

“The independent directors believe that the financial terms of the offer may be considered by some shareholders to be acceptable in the circumstances, and accordingly make no recommendation to shareholders whether or not to accept the offer.

“Over the course of 2015, the management of Colt has been working on a plan to refocus the company’s activities and significantly improve its financial performance. The Board has provisionally approved a new business plan and further details will be announced in due course.”

Colt’s shares were trading at around 156p before the bid and jumped straight up to 190p, implying the market thinks Fidelity’s bid is likely to be accepted.