Shares in consumer goods giant Unilever have risen after it effectively ended its pursuit of GlaxoSmithKline’s consumer healthcare business saying it would not raise its £50bn offer.

GSK revealed over the weekend that it had rejected a series of offers from the Domestos-to-Marmite company, saying they “fundamentally undervalued” the business.

But Unilever insisted even after the rejection that the portfolio of brands including Aquafresh toothpaste and Panadol painkillers, would be a “strong strategic fit”.

Reports earlier this week suggested it might need to up its offer to more than £60bn in order to bring the GSK and US drugs giant Pfizer – which owns 32% of the consumer healthcare business – to the table.

But the disclosure of Unilever’s approach over the weekend left investors unimpressed, sending shares sliding on Monday while giving a boost to Glaxo’s.

GSK’s response to the offer saw it set out a sales growth outlook, which said it was “well-positioned to sustainably grow ahead of its categories in the years to come” with annual growth of 4-6%, prospects it said were not reflected in the takeover offer.

In a statement at the close of trading on Wednesday, Unilever said it the outlook “does not change our view on fundamental value”, adding: “Accordingly, will not increase our offer above £50bn.”

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That gave a lift to its shares in early trading on Thursday, as they rose 2%, while GSK dipped by 2%.

Unilever’s decision not to up its bid came after analysts and investors widely panned the offer, citing worries about the financial implications.

The episode has also intensified unease about its prospects under chief executive Alan Jope, who had already been facing pressure over his approach even before the takeover tilt.

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