The board of Songbird Estates has rejected a joint bid from Qatar's sovereign wealth fund and Canada's Brookfield group to acquire the company that controls Canary Wharf.
"The Board of Songbird has reviewed the proposal with its advisers and has unanimously concluded to reject the proposal on the grounds that it materially undervalues Songbird," it said in a statement.
"This proposal significantly undervalues Songbird and does not reflect the inherent value of the business and its underlying assets," said David Pritchard, the independent chairman of Songbird.
"The group has an exceptional management team with a clear vision to deliver additional shareholder value, including from our 11 million square foot development pipeline, the largest in London."
Songbird earlier confirmed that it received a preliminary joint takeover approach from the Qatar Investment Authority and Brookfield Property Partners. The consideration was £2.95 per share in cash, valuing the company at about £2.2bn.
Qatar Investment Authority already owns a 28.6% stake in Songbird, while Brookfield holds about a 22% stake in Canary Wharf Group.
Songbird's other main owners are Simon Glick (26%), the China Investment Corporation (15.8%) and US investment bank Morgan Stanley (8.5%).
Following the announcement of the possible deal, Songbird shares skyrocketed, closing up 22.14% at £3.20 and valuing the company at more than £2.3bn.
Qatar has been increasingly investing in London's landmark properties, as the oil rich nation looks to capitalise on the safe-haven status of assets in the British capital.
Its wealth fund owns prized properties such as the Shard, upmarket department store Harrods, the Olympic Village in Stratford and Chelsea Barracks, in the west of London.
It has reportedly bought HSBC's 44-storey global headquarters in Canary Wharf for more than £1.1bn, in a deal which made the property London's most expensive office building.