Shareholders in takeover target Warrnambool Cheese and Butter (WCB) could get $9.20 for each of their shares if Canadian dairy giant Saputo can attain a stake in Warrnambool of more than 50 per cent.
At $9.20, WCB would be valued at around $515 million.
Saputo, one of three suitors for WCB, is currently offering $9.00 per WCB share and declared the offer unconditional on Monday.
The offer closes on December 13.
WCB shareholders who accept Saputo's offer now will receive $9.00 per share but will still get the extra 20 cents later if the 50 per cent threshold is reached.
"We have a very, very compelling offer beyond just the price itself, beyond the fact that it is unconditional, beyond the fact that it could be closed by December 13 and payment will be received within five days," Saputo boss Lino Saputo Jr told AAP.
According to Saputo's second supplementary bidder's statement released to the Australian Securities Exchange on Monday, Saputo has received acceptances for its offer totalling 0.783 per cent of WCB shares.
Saputo said its decision to declare its offer of $9.00 per WCB share unconditional and its intention to lift the offer price if the 50 per cent threshold is reached would enable WCB shareholders to benefit from Saputo's unconditional offer without delay.
The WCB board, which has already backed the Saputo offer of $9 per WCB share, on Monday agreed to the conditional increase.
WCB also revoked its intention to declare a special dividend of 46 cents per share and an additional dividend of 85 cents per share, which had been subject to Saputo achieving an interest of 50 per cent and 90 per cent respectively.
If WCB had paid the dividends, they would have been deducted from the $9.00 that Saputo was offering.
"The board unanimously considers that an unconditional offer of $9.00 cash per share from Saputo, together with the potential increase of 20 cents per share...is a simpler, more certain and potentially more valuable offer than the previously recommended Saputo offer," the WCB board said.
WCB shares were 18 cents higher at $9.23 on Monday.
The two others bidders for WCB are dairy co-operative Murray Goulburn and Bega Cheese.
Murray Goulburn has offered $9.00 per WCB share but its offer requires authorisation from the Australian Competition Tribunal on the grounds that a takeover of WCB by Murray Goulburn would be of national benefit.
Bega has offered 1.5 Bega shares and $2.00 in cash per WCB share.
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