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Elopak of Norway has raised its takeover offer for Swiss packaging company SIG, intensifying a battle with Graeme Hart's private company Rank Group for the firm.
The new Elopak offer values SIG at 2.6 billion Swiss francs ($3.11 billion).
Elopak increased its bid to 400 Swiss francs a share on Friday, topping Rank's 370-franc bid. SIG rejected Elopak's previous offer of 325 francs a share as too low.
Private equity house CVC Capital Partners and holding group Ferd are backing Elopak's bid for SIG.
Ferd and CVC said they had 10.61 per cent of SIG after having bought shares in the market.
But the Elopak bid has attracted the attention of competition regulators.
The European Commission says it is investigating to see if the Ferd/CVC bid would reduce competition in the already concentrated packaging market.
The EU executive had been set to decide on the deal by January 9, but will now have until May 15.
"An in-depth investigation will enable the commission to assess whether the reduction of competitors in the already highly concentrated market for carton packaging would possibly have anti-competitive effects and possibly harm consumers," the commission said.
The commission said the carton packaging market in the European economic area was controlled entirely by Tetra Pak and two smaller firms, SIG and Elopak.
"The proposed transaction would combine the second and the third largest suppliers, while Tetra Pak would remain the largest competitor," the commission said.
Remedies offered by Elopak had not addressed anti-competitive effects of the merger.
Elopak and SIG make plastic bottles and cardboard cartons to package juice and milk. SIG is strong in sterile liquid-food packaging, and Elopak focuses on technologically less complicated packaging for fresh foods.
SIG shares have risen 41 per cent this year, profiting from duelling takeover bids by Elopak and Rank.
Rank is owned by Graeme Hart, New Zealand's richest man.
Rank bought Carter Holt Harvey, New Zealand's largest forestry company, for $3.3 billion this year. It bid for the company after securing International Paper's 50.5 per cent stake in CHH.
Under Hart's control, Carter Holt is also buying International Paper's global beverage packaging business.
It has sold the bulk of Carter Holt's forest estate and slimmed down the company's head office.
Rank said a takeover of SIG would give it an advantage in terms of size, market presence and global reach.
Elopak's aim is to create a stronger rival to privately owned Tetra Pak of Sweden.
- REUTERS
