Lone Star raises offer for UK's Quintain, offer now unconditional

(Reuters) - U.S. private equity firm Lone Star raised its offer for Quintain Estate and Development Plc to about 745 million pounds on Friday after comments from an activist shareholder threatened to demolish its takeover plans.

The revised offer of 141 pence per share, 10 pence higher than its previous bid, helped Lone Star win enough shareholder support to declare the offer unconditional.

The offer, which gives Lone Star access to one of London's few remaining large-scale development opportunities, represents a premium of about 31.8 percent to Quintain's closing price on July 28, the day before the first offer was announced.

Quintain's shares rose more than 7 percent to touch the offer price. The stock was trading at 140.75 pence on the London Stock Exchange at 1126 GMT.

The company's shares have been trading at a discount to its net asset value - the market value of its portfolio - due to the risk associated with holding large land assets without permission to build.

Lone Star's new offer comes two days after activist shareholder Elliott Capital Advisors said that the original offer substantially undervalued Quintain and that it had not accepted the offer.

Elliott had by then build up a nearly 13 percent holding in the company through derivatives. It has since raised its holding to about 14 percent, a regulatory filing showed on Thursday.

A spokesman for Elliott declined to comment on the new offer when contacted by Reuters by email.

Elliott's earlier comments had raised doubts that Lone Star's bid would be successful, even though it was supported by Quintain's board.

Lone Star said early on Friday that had valid acceptances for 71.73 percent of Quintain's shares.

After raising the offer, the private equity firm said this had increased by 4.30 percent, allowing it to cross the 75 percent threshold required to declare the offer unconditional and requiring remaining shareholders to tender their shares.

Lone Star did not give any reason for increasing its offer for Quintain, which owns a large amount of undeveloped land around London's Wembley Stadium.

(Reporting by Esha Vaish in BENGALURU, additional reporting by Nishant Kumar and Sinead Cruise in LONDON; Editing by Anupama Dwivedi and Ted Kerr)