Glass maker Pilkington, which has a large factory in Kings Norton, Birmingham, is thought to be preparing for talks with its smaller Japanese suitor which could see it taken over for more than £2 billion.
Last week Pilkington rejected a prospective offer from Nippon Sheet Glass of 150p a share, which valued the company at £1.97 billion.
But, according to reports yesterday, Pilkington chairman Sir Nigel Rudd may be prepared to agree to an offer of at least 165p a share from Nippon - valuing the company at £2.16 billion.
It is understood that Sir Nigel is determined not to undersell the Merseyside firm and may start negotiations by demanding 170p from Nippon.
Last week, Pilkington told Nippon that its proposed offer of 150p a share fell "materially short of a price which the board is prepared to accept".
Nippon already owns nearly 20 per cent of Pilkington and it was thought it could generate savings from combining its UK subsidiary NGF Europe with the headquarters of Pilkington as they are both based in St Helens.