A$497m offer for medical company

US diagnostic test maker Cytyc says it has bid A$497 million ($578 million) for Australia's Vision Systems, topping a rival offer by Ventana Medical Systems and driving up Vision Systems' shares.

Cytyc said it had offered A$2.35 a share in cash for Vision Systems, which makes instruments and reagents used to detect cancer.

That was 10 per cent above the A$2.13 offered by Ventana.

Vision Systems managing director James Fox said the latest bid was good news for shareholders.

"The highest price will win and that's not over yet obviously. We've had a Ventana bid, now there's a Cytyc bid and there may be another bid, who knows," he said.

Shares in Vision Systems jumped 9 per cent to A$2.46, suggesting investors believe an even higher bid could be made.

- REUTERS