By Tessa Walsh

LONDON (Reuters) - Royal Dutch Shell (RDSa.L: Quote, Profile, Research) and Exxon Mobil (XOM.N: Quote, Profile, Research) have dropped plans to sell British biofuel additives producer Infineum, the companies said on Tuesday.

ExxonMobile Chemical and Shell Chemicals announced in March that they were reviewing strategic options for the Infineum additives business.

"The companies confirm that this (strategic review) has been completed and the conclusion from this study is for the shareholders to retain the business," the companies said in a statement on Tuesday.

The two companies were expecting bids in June through sell-side adviser JP Morgan but bids failed to meet expectations and the bidders failed to secure firm financing, banking sources said on Tuesday.

"The deal is dead. Shell pulled the sale when the price was nowhere near expectations around two to three weeks ago," a head of loan syndicate said.

The failure of the sale is further evidence of the difficulties experienced recently in financing leveraged buyouts in Europe's troubled leveraged loan market.

Blackstone Group LP (BX.N: Quote, Profile, Research) dropped the sale of its French private clinics operator Vitalia when bids failed to meet expectations, 3i Group Plc (III.L: Quote, Profile, Research) pulled the sale of its Nordic healthcare company Ambea in June for the same reason and numerous other sales including that of Italian fashion house Roberto Cavalli have been cancelled or delayed by adverse loan market conditions.

Shell and Exxon were looking for a bids of around 2 billion pounds for Infineum, their 50-50 performance fuel joint venture, with a debt financing of around one billion euros (800 million pounds), bankers said.