Olivant Advisers Ltd has dropped out of the the race to take control of ailing British bank Northern Rock plc.

Olivant said it couldn't figure out a way to make a suitable investment while falling in line with the British governments demands.

The investment group was one of three competing firms which had been expected to submit bids for Northern Rock Today.

Despite working intensively, we have been unable to formulate a value creation proposal which meets our investment criteria whilst also respecting HM Government's proposed financing terms and the interests of other stakeholders in the company, said Olivant Chairman Luqman Arnold in a released statement.

The U.K. government, which bailed out Northern Rock with 25 billion pounds in emergency loans last year, has demanded that any the firm which wins control of the bank must set aside some of its earnings to repay the government.

Investment