Private equity firm Kohlberg Kravis Roberts (KKR) moved closer to winning a $22 billion bid battle for Alliance Boots today after raising its offer 4.5 per cent and securing nearly 30 per cent of the company shares.
KKR, which has the support of Alliance Boots deputy chairman and biggest shareholder Stefano Pessina, said it had raised its agreed bid for Britain's biggest pharmacy chain to 1,139 pence a share in cash, or about £11 billion.
This trumps an indicative bid of 1,126 pence a share from private equity firm Terra Firma, which is working with medical charity Wellcome Trust and banking group HBOS in the proposed offer.
The new KKR offer is also up from the consortium's previously agreed deal of 1,090 pence a share.
Alliance Boots said it would recommend the KKR consortium's new offer, as it had its previous bid.
A takeover would be Europe's biggest leveraged buyout and the first private equity takeover of a company in the FTSE 100 index.
KKR also said it had bought 89.9 million shares at the new offer price at a cost of about £1 billion between Monday and Tuesday.
Market sources said KKR purchased a further 25 million shares in late morning trade today at 1,130 pence a share. This would give KKR a stake of about 13 per cent in Alliance Boots and, on top of Mr Pessina's 15-per cent stake, means its consortium now controls nearly 30 per cent of the company shares.