BRISTOL, U.K. -- UK-based tobacco company Imperial Tobacco Group plc is likely to raise its offer for Franco-Spanish cigarette-maker Altadis that rejected its $8 billion bid earlier in March, various media reported yesterday, citing sources familiar with the matter.
Meanwhile, reports added that at least three European private-equity firms are also interested in a buy out deal with Altadis, according to an RTTNews report. The presence of private equity firms may put pressure on the U.K. tobacco company to speed up its decision and also to increase [image-nocss] its bid.
The board of Altadis unanimously rejected a 45-Euro-per-share offer from Imperial, claiming it undervalued the company. Imperial Tobacco reportedly will increase its bid for Altadis to 48 Euro per share, if it can secure a recommendation for a revised offer from Altadis' board. Imperial has previously said that wants to pursue friendly talks with Altadis and was expected to return with a higher bid as soon as this week.
Imperial Tobacco chief executive Gareth Davis last week backed the company's desire to win backing from the board of Altadis for its approach. "Our intention is to pursue further friendly dialogue with a view to obtaining a recommendation," Davis said, according to the RTTNews report.
According to analysts, Imperial could pay up to 49 Euro per Altadis share. If Imperial is successful, a takeover would merge the world's fourth and fifth-biggest cigarette companies.
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