The UK's biggest insurance company Aviva has effectively ended its campaign to acquire its largest domestic rival Prudential plc in less than a week, having failed to gain the support of the coveted company's board.

At the beginning of the week Aviva, parent of Norwich Union, revealed a takeover plan that effectively valued its close competitor at GBP17 billion. The insurance titan had finally taken the plunge into trying to create a British insurance ‘super-company’ to rival the likes of Axa in France and Allianz in Germany.

However, Aviva stated from the start that it was only interested in a ‘friendly’ bid and it had published its bid proposal in order to gain support from Prudential shareholders. The official response was swift and uncompromising as the Pru’s board rejected any possible tie-up, pointing to its recent good financial results and global reach as reasons to continue on its own.

As the week progressed Aviva had hoped to win over sufficient support, both from shareholders and the Prudential board, to avoid its proposed takeover from morphing into one of a hostile nature. However, Aviva has now effectively ended its interest by sticking to its contention that it does not want to enter into a hostile process.

In coming to its decision, the board of Aviva determined that it was not in the best interests of its shareholders to make any material adjustment to its proposed terms, it said in a statement.

The mini saga has had a dramatic effect on the value of Prudential shares. The initial bid revelation inspired a jump in Prudential’s share price, however the news of Aviva’s withdrawal have now caused shares in the UK’s number two insurer to fall by 7%, Reuters reported.