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G4S security staff a Rugby League game between the Huddersfield Giants and Warrington Wolves, at the City of Salford Stadium, on July 15, 2012.Carl Recine/Reuters

Canadian security company GardaWorld has sweetened its offer for British-based rival G4S PLC by 24 per cent, setting the stage for what many analysts expect will be a bidding war for the world’s largest security services corporation.

The offer is now 235 pence per share for G4S and will not be increased unless G4S receives a firm and competing bid, Montreal-based Garda said Wednesday in a statement. That values G4S at £3.68-billion ($6.35-billion at current exchange rates).

Garda’s previous bid of 190 pence did not gain much traction with G4S investors, with barely 0.17 per cent of G4S shares being tendered to Garda as of Nov. 28. But this new offer could change the game, analysts said.

The raised bid comes with what Garda called a £770-million “support package” to address G4S’s pension issues. And it reduces the acceptance condition from 90 per cent to a 50-per-cent-plus-one majority of G4S shares, significantly increasing the likelihood of a deal, according to Deutsche Bank analyst Steve Goulden.

“Shareholders have a simple choice: Remain invested in a company which has consistently failed them and the wider community for so many years or realize their investment in cash, at a significant and highly attractive premium,” Garda chief executive Stéphan Crétier said. “It’s time for G4S to get back to its entrepreneurial roots.”

With G4S, Mr. Crétier is trying to score the deal of his career – one that will reshape an industry that’s growing globally. The 57-year-old has had his eye on the world’s top player for years.

Mr. Crétier’s aggressive tactics, including criticizing the company he wants to buy, have not been particularly well-received. The G4S board has declined to engage Garda in any meaningful talks. And a fight erupted between the CEO and hometown pension fund Caisse de dépôt et placement du Québec over its involvement in the contest for G4S that has escalated to the threat of legal action.

But those things matter little, analysts said. A handful of large institutional investors control the future of G4S, including asset management companies Schroders and Harris Associates – and they care about price.

G4S has “quite a solid bunch of longer-term investors who are still quite supportive [of management],” said Stephen Rawlinson, analyst at Applied Value in London. “But there comes a point where they’ve got to keel over and say, ‘We can’t be doing this. We want the cash.’”

Securities brokerage Louis Capital has surveyed 10 G4S shareholders and concludes it could take a clearing price topping 255 pence a share to complete a deal. The shares closed Monday up 7 per cent to 246 pence in trading on the London Stock Exchange, implying that investors believe Garda’s revised offer of 235 pence won’t be the final one.

Garda, controlled by British private equity firm BC Partners, is battling rival suitor Allied Universal Security Services for G4S and, indirectly, the Caisse as Allied’s second-largest shareholder. Allied has made what G4S has called a “highly conditional indicative offer” for G4S of “at least” 210 pence a share, subject to significant due diligence. It has until Dec. 9 to make a firm bid.

“I think this is a starting point,” Louis Capital analyst Tyler Tebbs said of Garda’s latest offer, adding he expects Allied to come back with a competing offer. “We’ve got more room to go.”

G4S said Wednesday its board was evaluating GardaWorld’s new proposal together with legal and financial advisers and urged its shareholders to take no action. The company rejected Garda’s previous bid, calling it “highly opportunistic.”

G4S is in talks with Allied and could recommend an Allied offer if a deal is concluded. It is providing both suitors with access to financial information under British takeover rules.

Garda’s all-cash offer expires on Dec. 16. Investors in the British company have signalled they are open to a deal as long as it’s at a fair price.

Any tie-up between Allied and G4S would not pass anti-trust hurdles, Mr. Crétier has said. In fact, Allied won anti-trust approval to buy G4S from the U.S. Federal Trade Commission in mid November. Garda has also obtained regulatory clearances in the United States and the European Union.

Mr. Crétier, a former professional baseball umpire, has said Garda would make major capital investments to turn its base in Montreal into a global hub for advanced security technology if it wins G4S. That would include a new headquarters in the city, possibly based in the building formerly housing shoe retailer Aldo.

With a report from Paul Waldie

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