Precious stones miner Gemfields has rebuffed a takeover tilt from its largest shareholder, branding the £211 million bid as "derisory".
Pallinghurst Resources tabled an offer for the Faberge owner earlier this month as it looked to acquire the 53% of the company it does not own.
If accepted, t he move would have handed Gemfields investors 1.91 of Pallinghurst shares for every share held.
However, the AIM-listed firm dismissed the proposed tie-up after an independent committee concluded that it " significantly undervalued" the firm, its "unique asset base" and its "leading position in the coloured gemstone sector".
Graham Mascall, chairman of the independent committee, said: "The independent committee is unanimous in concluding that the unsolicited offer from Pallinghurst is derisory and clearly undervalues the company.
"The independent committee believes the unsolicited offer has the potential to dilute Gemfields shareholders with inferior assets that offer exposure to more volatile commodities and with less attractive prospects."
Gemfields mines for emeralds and amethysts in Zambia and ruby and corundum in Mozambique.
It snapped up Faberge - renowned for making lavish Easter eggs for Russia's royal family - from Pallinghurst for £89 million in January 2013.
Shares in Gemfields fell more than 1% in afternoon trading.
Mr Mascall added: "The unsolicited offer would appear to be driven by Pallinghurst's proposed restructuring, which seeks to preserve the Pallinghurst investment managers' own self-interests at the expense of the independent shareholders of Gemfields."