The battle for control of Dobbies Garden Centres intensified yesterday in the wake of fresh moves by bid rivals Tesco and Sir Tom Hunter.
Only 50 per cent of Dobbies shareholders are now required to back Tesco's bid after the retail giant cut the acceptance threshold late on Wednesday.
The group's move followed a series of share raids by Scottish tycoon Sir Tom, who has upped his holding in the garden centre group to 25.6 per cent, effectively blocking the original £156 million Tesco offer, which required 75 per cent shareholder support.
But analysts said Tesco will have to up its £15-a-share bid price if it is to win over investors after Sir Tom's share purchases at £18.45.
Seymour Pierce analyst Richard Ratner said: "Tesco is going to have to raise its offer, given what Hunter has been paying in the market for shares."
He added Sir Tom would have to bid for the entire company to block the Tesco takeover, but may decide to sit tight as a "troublesome minority" if Tesco cannot persuade him to strike a deal.
"It now looks as if we will get an outcome for shareholders, albeit a slightly messy one for the company," said Mr Ratner.
Tesco first put in its offer for Dobbies on June 8 in a move aimed at extending its offering in the non-food market and capitalising on the boom in demand for gardening products.
Sir Tom has been linked to a possible takeover of Dobbies for some months amid rumours he wanted to add to his existing garden centre businesses, the Midlandsbased Wyevale Garden Centres and Blooms of Bressingham.
The entrepreneur already owned more than ten per cent of the Midlothian-based business through his West Coast Capital investment vehicle before Tesco revealed its planned swoop.
Tesco would be highly restricted in its plans for Dobbies if its offer is accepted with just 50 per cent backing, as it will not have constitutional control of the company.
The supermarket is believed to want to expand the group to the south of England and offer a greater range of carbon-efficient products, such as solar panels and insulation.
Dobbies, which dates back to 1865 as a brand, currently has 21 stores, including sites in Atherstone and Shrewsbury.
Dobbies shareholders have until July 18 to accept the Tesco bid.