Shares in MP Evans soared to an all-time high of 710p after Kuala Lumpur Kepong, sweetened to $517m its takeover bid for the plantations group.
However, the stock fell back after MP Evans rejected the new offer "on the basis that it very substantially undervalues the company, its unique position and its future growth potential," but prices remain well up on the offer.
Malaysia-based KLK, which has a market cap of $5.8bn, raised by 100p to 740p per share its offer for MP Evans, valuing the London-listed group at £415m ($517m)
The new bid represented a premium of 74% to MP Evan's stock price before the first approach.
Indeed, the offer represents a "compelling value proposition", said KLK, adding that it "provides a significant opportunity for MP Evans shareholders to realise substantial value from their investment in the context of the low liquidity in the trading of MP Evans shares".
KLK added that the sweetened offer would be final, except in two circumstances – that a rival suitor emerged, or MP Evans recommended an increased offer.
But MP Evans, which rejected the initial offer as too low, said that the revised offer also undervalued the group.
And broker VSA Capital also raised questions over the generosity of KLK's offer, which the broker said valued MP Evans at $12,900 per planted hectare.
"Although at a premium of 25% over our current Indonesian producer listed peer group median average of 24 companies, our view remains that an offer of 780p-850p [a share] is more in line with the current value of the business and its future prospects," said Edward Hugo, head of research at VSA.
Shares MP Evans, which is being advised by Peel Hunt and Rothschild, closed at 671.5p, up 7.2% on the day.
By Tanya Ashreena