Akzo Nobel inched closer to securing a takeover of ICI yesterday after the British maker of Dulux paints agreed to open its books following a raised £8.1 billion indicative offer from the Dutch predator.

Confirming a report in The Times on Friday, ICI said in a statement that Akzo had offered 670p per share, plus a 5p dividend, subject to due diligence. It was the second time in a week that Akzo, which is bidding with Henkel, the German consumer products company, had agreed to raise its bid.

In response, ICI said that it would allow the Dutch maker of Crown paints to undertake “certain limited due diligence” to enable it to table a formal bid.

Akzo has until Thursday to make a formal offer under a Takeover Panel deadline, although ICI is understood to be willing to ask the Panel for an extension if the Dutch group needs more time to put its bid together.

ICI shares, however, continued to trade below the raised indicative offer. Yesterday, they closed up 3p at 634½p as investors remained sceptical that Akzo’s shareholders, which must approve the offer, under Dutch rules, would support the bid.

The TPG-Axon hedge fund, which holds a 3.5 per cent stake in Akzo, has already said that it would not support a bid at that level.

James Knight, an analyst with the stockbroker Collins Stewart, said: “The biggest hurdle, by far, remains approval of the deal by Akzo shareholders. We estimate the chances as better than evens, but difficult to call.”

One of the reasons for the difficulty is that Akzo’s shareholder base has changed considerably this year, Mr Knight said. He now estimates that hedge funds or activist investors could constitute more than 40 per cent of Akzo’s register.

However, he noted: “On the plus side, the option of voting down the bid to force Akzo as a takeover target itself is less likely, given the current credit crunch on private equity.”

Shareholders could be holding out for a higher bid. So far, speculation has swirled around BASF, the German chemicals group, and Dow Chemical, the American group, as the two most likely counter-bidders.

Analysts, however, believe that a bid from BASF is unlikely, given that the group is busy digesting more than €10 billion (£6.8 billion) of prior acquisitions. A bid from Dow is also seen as unlikely since the US group could have taken advantage of ICI’s lower share price when it was trading at £4.50 six months ago if it had been serious about a deal.

However, Dow Chemical is believed to be considering its options and is not ruling out a bid for ICI or Akzo itself.

There are also potential antitrust concerns, given the overlap of Crown and Dulux in the British and Irish markets. Sources said yesterday that Akzo would file its proposals to overcome any regulatory concerns once it had launched a formal offer. Yesterday’s raised bid was the latest twist in the battle for the 81-year-old British coatings and chemicals manufacturer. Akzo initially tabled a 600p proposal in June, but ICI immediately rejected the offer as undervaluing the company. It also dismissed a second approach last week at 650p.

The raised approach and yesterday’s fresh 670p bid included a simultaneous side-deal to sell ICI’s adhesives and electronic materials businesses to Henkel. In a statement yesterday, Akzo said that the deal with Henkel was worth £2.7 billion, which sources said meant that Henkel was effectively paying the entire 70p extra in cash.

Although no details of proposed synergies from the deal have yet been given, sources said that they would be upwards of £250 million and that both ICI and Akzo investors would back the deal once they had seen the numbers.

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