Terra Firma, a UK private equity firm run by Guy Hands, has pulled its £453m (€666m) bid for East Surrey Holdings. The UK water utility's shares fell by as much as 11% to 435p on the news.

East Surrey said in a statement today: "East Surrey Holdings was informed yesterday evening by Terra Firma Investments that it would be making an application to the Takeover Panel to invoke the regulatory conditions set out in the scheme document dated 11 May 2005 in order to lapse the proposals.'