Central Pacific CEO Clint Arnoldus said a month ago that he would walk away from his $400 million hostile bid to take over City Bank if the rival did not respond by yesterday.

By the close of business yesterday, Central Pacific Financial had still not announced whether City Bank executives responded to its April 15 deadline for merger negotiations. And City Bank said there was nothing new to report.

In announcing it would extended the deadline another week, Central Pacific said it "could not comment on its decision at this time." It also gave no explanation for why it was pushing back the conference call on its earnings.

The weeklong extension for merger talks could refuel speculation that the effort to take over City Bank has fallen through after a year of public rancor and legal maneuvering that cost Central Pacific $10 million and its target nearly $7 million.

Central Pacific's April 15 deadline had been seen as possibly the best way to save face if indeed the deal was dead.

"This was as graceful an exit as they could possibly concoct," said Scott Keller, president of New York-based DealAnalytics.com, a merger and acquisitions research firm. "This was never a bad idea. But local politics and increasing bad blood between the two sides made a marriage impossible."

Even if the two sides were not officially declaring an end to the deal yesterday, Wall Street seemed to be. Shares of City Bank's parent CB Bancshares fell 4 percent to close at $67.21. If investors thought the latest offer from Central Pacific, which was equal to about $87 a share, had a good chance of succeeding, the price would likely rise to near that level.

"A hostile takeover is rather unusual. In order for one of those to succeed, there must be willingness by both parties to work together," said Lawrence Johnson, former chairman and chief executive of Bank of Hawaii.

But almost from the beginning of the takeover, communication between both banks deteriorated.

Central Pacific made several missteps that City Bank management capitalized upon, said Keller.

Central Pacific should have been more aggressive in its pursuit of City Bank by offering its best offer price at the outset, instead of raising the bid twice, he said. It would have convinced City Bank's board that Central Pacific was a serious suitor with an attractive bid on the table and given shareholders a stronger reason to pressure City Bank management to negotiate.

"If they came out with a bid that was almost too good to resist, they would have credibility from the get-go," Keller said.

Central Pacific should have staged a formal proxy fight, he added. That's where shareholders are convinced to use their proxy votes to get rid of current management and install one friendly to the merger.

But Central Pacific's initial bid was not high enough to be taken seriously by arbitrageurs — such as hedge funds who buy shares of the target company in hopes of making a quick profit when the deal goes through. Arbitrageurs could have applied pressure to City Bank's board, Keller said.

By the time Central Pacific significantly raised its bid, the merger had taken too long and opportunities to seize the upper hand had vanished.

City Bank also hired two high-powered New York specialists to assist them — the Skaaden Arps law firm and Sandler O'Neill, an investment banker. As a result, they were able to legally outmaneuver Central Pacific, whose attorneys were not from "big-time law firms," Keller said.

Finally, Central Pacific should have been more hostile in their hostile takeover, he said.

Either you win the takeover or you care what your neighbors think. The bank should have been firm whether they'd rather win or be liked, he said.

"This isn't a tea party. You have to take the gloves off and fight dirty," he said. "The lesson to be learned here is you can't do things halfheartedly, otherwise you undermine your own credibility. It's a game that requires extremely aggressive tactics. ... The Hawai'i culture is reluctant to be aggressive."

So if after the dust has settled the merger is off, who would have won and who would have lost in this yearlong battle?

City Bank management would have won because they get to keep their jobs, said Eric Mais, chairman of the University of Hawai'i finance department. City Bank shareholders would lose because a chance to reap a large profit disappeared, and the stock might continue to fall if the deal is dead.

Central Pacific's management would lose because the acquisition would have helped them lower costs and become a stronger competitor to Bank of Hawaii and First Hawaiian Bank, Mais said. Its shareholders would lose in the long term because a stronger bank could lead to higher share prices.