The source said Saint-Gobain approached BPB's (BPB.L: Quote, Profile, Research) management on Friday, requesting a meeting to bring an end to a months-long impasse over the French company's 3.6 billion pound hostile bid, which BPB has rejected as significantly undervaluing the company.But the board of the world's largest plasterboard maker rebuffed the invitation, the source said on Monday."They asked them if they wanted to talk but ... there were no meetings," the source said.
People familiar with the situation told Reuters on Sunday that Saint-Gobain was prepared to raise its offer to 3.8 billion pounds -- or 760 pence a share -- in exchange for a board recommendation.
"They (BPB) knew where they were at the weekend, but they did nothing," the source said.
Shares of BPB were up 1 percent at 741-1/2 pence a share by 12:40 p.m. as investors held out for a higher bid. Under UK takeover regulations, the French firm has until Friday to come up with a higher offer or walk away.
BPB declined to comment. A spokeswoman for Saint-Gobain said: "We are not prepared to comment on speculations over whether we will increase our offer. Suffice to say we will not overpay for BPB."
Saint-Gobain's advisers plan to meet BPB's shareholders on Monday to discuss the price at which they would be prepared to sell, the source said, adding that meetings with investors began on Friday.
The shareholders have consistently supported BPB's board, but analysts say they could be persuaded to back a higher bid if it were pitched somewhere in the range of 750 to 780 pence a share, particularly as there is no other offer on the table.
Saint-Gobain shares were up 0.24 percent at 45.89 euros.
"If Saint-Gobain manages to get BPB with only a 5 percent increased offer, I think the market would receive that well," said one Paris-based analyst who asked to remain nameless.
"It's far from certain that BPB shareholders would accept the new offer, but hedge funds may be starting to play their roles. There is no alternative offer, and if the Saint-Gobain offer does not go through, BPB shares will fall back to where they stood before this all began."
Saint-Gobain said on Monday it would extend the deadline for shareholders to accept its current offer to 1 p.m. on December 2. So far just 0.7 percent of BPB shareholders have backed the bid.