Photobitions share price has plummeted 50% after Equitable Life, one of its three largest shareholders, disposed of its stake.
Shares halved to 4p, valuing the debt-laden group at just below 4m. Only 19 months ago the price peaked at 551.5p.
A spokeswoman said Photobition was awaiting official confirmation of the deal, but declined to comment further.
The news furthers speculation that investment group Alchemy will make a bid for Photobition (PrintWeek, 5 October).
Photobition has still to publish results for the year to 30 June. It has until the end of the month under Financial Services Authority rules.
Edinburgh Fund Managers has also reduced its stake from 10.28% to 9.8%.
* The Photobition Forum Action Group has brought its website campaign to a close. "We had reached a point where no one was listening to us or supporting our views," said a spokesman.
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