Private equity firm Clayton, Dubilier & Rice (CD&R) could increase its offer for UDG Healthcare to £2.72 billion, the international healthcare services provider said today, after shareholder opposition to a previously agreed bid.
Ireland-based UDG said the potential 1,080 pence per share offer would be CD&R's final one, adding that it plans to recommend the new proposal.
In May, both companies had agreed to a 1,023 pence per share offer.
Private equity firms in recent months have expressed interest in several companies as London-listed firms carry a discount to global peers and the funds see a chance for handsome returns as the UK economy recovers faster than expected.
Today's deal is CD&R's second takeover target in recent weeks.
The fund last week made a bid for UK supermarket group Morrisons, which was rejected.
While UDG's board backed CD&R's first offer, its largest shareholder Allianz Global said last month it planned to reject the bid as it significantly undervalued UDG.
It has an 8.65% stake in the healthcare group, Refinitiv Eikon data showed.
UDG said today that CD&R was engaging with some shareholders over support for the possible final offer, and confirmed that it had not received any other buyout proposal, nor was it in talks with another party.
Just weeks after the first offer, activist investor Elliott took a stake in UDG, while a report in the Financial Times in May said UDG investor M&G was not in favour of CD&R's prior offer.
UDG specialises in healthcare advisory, communications, commercial, clinical and packaging services.
It has strong market positions in the pharma services space and it employs around 9,000 people in 29 countries.
Both its Ashfield and Sharp businesess operate in large and growing markets, underpinned by continued growth in new drug development and approvals, increasing therapeutic and drug complexity and continued outsourcing from pharma and biotech clients.