Sweden's Financial Supervisory Authority said on Tuesday Qatar Holding had withdrawn its request that the financial watchdog approve it as a suitable owner of Nordic bourse operator OMX.

The authority said in a statement it was now ending its scrutiny of Qatar's application dated October 2, indicating that investment vehicle was no longer eyeing a takeover of OMX.

Qatar Holding, which owns 10 percent of OMX, had been seen as a potential rival suitor for OMX to state-run Borse Dubai which, teaming up with US exchange Nasdaq, has offered 265 crowns per share for the bourse operator.

OMX shares fell on the news and were down 2.5 percent to 259 crowns by 1311 GMT, just underperforming a 2.2 percent fall in the broader market. An analyst said that while the news was not unexpected, it did douse hopes for a higher bid.

"The share was trading above the offer level, showing that some people had hoped for another offer," West LB analyst Johannes Thormann said.

Borse Dubai and Nasdaq, rival bidders at first for OMX, agreed earlier this year on a deal where Borse Dubai sweetened its takeover offer for OMX to about $4.9 billion and pledged to sell the Nordic and Baltic bourse operator to Nasdaq in exchange for a 20 percent stake in the combined group.

The OMX board of directors has recommended the offer. But the Qatar Investment Authority urged OMX shareholders to take no action and amassed a stake in the Sweden-based firm through its investment vehicle Qatar Holding, emerging as a potential rival to Borse Dubai and Nasdaq.

Borse Dubai said in October the offer had received acceptances representing 47.6 percent of OMX shares. - Reuters