3i infrastructure group halts Gatwick bid:

The source told us the consortium was not prepared to match the asking price put up by Gatwick's Spanish owner Ferrovial believed by analysts to be in the region of 2 billion pounds ($2.89 billion).

But Ferrovial airports arm BAA hit back at the claims, saying the market would set the price for Gatwick and that it remained confident it would see offers above the airport's Regulated Asset Base of around 1.65 billion pounds.

"Contrary to comments being reported today, the market and market alone will determine the sale price of Gatwick Airport. Given the level of interest in Gatwick, we remain confident that we will see a significant premium to RAB," the spokesman said.

The withdrawal of the 3i infrastructure consortium, which also includes the Ontario Teachers' Pension Plan and Canada Pension Plan, is the second pull-out since a first round bidding deadline last month but it still leaves four potential bidders in the ring.

"Having considered its position very carefully the consortium has decided to freeze all activities related to the transaction," the source said.

Ferrovial shares fell following the comments and traded at an intraday low of 21.49 euros, down 3.7 percent.

The source said the trio "have put a lot of work into it, but are not prepared to meet the price currently being demanded."