Lighthouse Group has criticised the £17 million bid AFH Financial tabled, claiming it 'fundamentally undervalues' the group.
In a statement on the stock market, the Lighthouse board of directors took into consideration the firm's strong balance sheet position and claimed this was not reflected in the bid.
The statement read: 'The board of Lighthouse believes that the indicative offer from AFH fundamentally undervalues the group and its prospects, especially in the context of the group's net cash position of £7.9 million as at 31 December 2015.
'Shareholders are advised to take no action. Further announcements will be made as and when appropriate.'
The bid of £17 million was initially made on 9 March, which would be a 26.8% premium.
Upon rejection, a notice from AFH read: 'Disappointingly, the board of Lighthouse has informed the company that they are not prepared to meet to discuss the terms of a possible offer and, on 16 March 2016, Lighthouse's advisers confirmed in writing that the board of Lighthouse had rejected the indicative AFH offer.'
The wealth consolidator, led by chief executive Alan Hudson(pictured) has been very active on the M&A front, making 11 acquisitions over the year in 2015. The acquisitions helped funds under management double to £1.8 billion, as revealed in its results in January.