U.S. buyout giant Blackstone looked poised on Thursday to win a 1.7 billion pound takeover battle for United Biscuits after rival bidder Premier Foods Plc pulled out.

Shares in Premier, whose main brands include Branston Pickle, Angel Delight desserts and Smash instant mashed potato, were trading down 3.9 percent at 268 1/4 pence by 8:41 a.m., the biggest faller among FTSE 250 shares.

Premier announces that discussions regarding its potential acquisition of the UK and Ireland biscuits and snacks businesses of United Biscuits have terminated, the company said in a statement.

Premier continues to consider acquisitions to be an important part of its overall strategy and evaluates potential acquisition opportunities according to its strict set of acquisition criteria.

The private equity owners of United Biscuits, famed for its McVitie's biscuits and Jaffa cakes, have invited bids which are likely to value the business at around 1.7 billion pounds, sources close to the situation said earlier this month.

Premier and New York based Blackstone were the only two bidders competing for the company, which also makes Hula Hoops and McCoy's crisps. With Premier out of the picture, the U.S. private equity firm is the only party left.

Blackstone had no immediate comment.