Brothers Michael Smurfit and Dermot Smurfit are to miss out on a £91 million pay day, after the Finnish based paper and packaging company said on Monday that it had terminated its takeover discussions with US private equitygroup Madison Dearborn.

Powerflute, the London-listed paper and packaging company, had indicated earlier this month that it had been approached by Madison Dearborn with a £261.5 million offer.

However, in a statement on Monday, Powerflute said that it had terminated discussions, following “consultations with certain major shareholders” of the company.

If the deal had gone ahead, the two most senior members of Ireland’s best-known corporate dynasty stood to earn about £91 million (€126m), as both were in line to be paid 79p per share with a 6p earn-out for their stakes. Dermot Smurfit, who is chairman of the company and founded it in 2004, and Michael Smurfit’s Isle of Man-registered Bacchantes, own more than 36 per cent of the company between them.

Madison Dearborn took Smufit Kappa group private in €3.5 billion deal in 2005. Michael Smurfit was chief executive at the time, and filings for the proposed Powerflute deal show that Mr Smufit was also acting as an adviser to Madison Dearborn on its bid for the Finnish company.

Powerflute told investors that his Bacchantes vehicle may reinvest in Powerflute alongside Madison Dearborn. Dermot Smurfit, the company said, would exit if the deal is completed.