Charles Allen, the chairman of Global Radio, was considering whether to sweeten his offer for GCap Media last night after the Classic FM owners rejected a revised offer that valued Britain's biggest commercial radio broadcaster at £333 million.

Mr Allen, who has until the Takeover Panel deadline on Wednesday to table an offer, is understood to be considering whether to make an improved bid of around 215p a share.

Global put forward a revised offer yesterday that valued GCap at 202p a share. An earlier offer at 190p was rejected in January.

Fru Hazlitt, GCap's chief executive, told The Times that leading shareholders gave full support yesterday afternoon after the approach for GCap in the morning. The board had been criticised for its failure to inform investors of an approach from Global at the end of last year, although GCap has maintained that its shareholders have continued to support the board.

Ms Hazlitt, who became chief executive of GCap last December, unveiled her new “defence document” earlier this year. She says that her new plan will provide greater long-term value for shareholders than an offer from Global.

“It is up to shareholders to work out target prices. What I am confident about is that there is serious value to be had in the company and a lot of upside we can create here. We believe we have the right strategy and the team to deliver that strategy,” she said.

While Global Radio executives were unavailable for comment yesterday, sources said that the company was reviewing its options. Going hostile is still an option for Global, but it is more likely to improve its offer.

One leading institutional shareholder said that Global also had regulatory concerns. However, industry sources said that there were minimal regulatory issues.

Vincent Vinatier, a fund manager at Schroders, which owns 16.1 per cent of GCap, said: “We are long-term shareholders and happy to wait for plans for current management to come through. We are happy with the plan. The synergies from merging such businesses have been significant and we don't feel the current offer reflects the value of the synergies.”

The latest approach was subject to conditions including due diligence and finalisation of financing.

The GCap board said that the improved offer “substantially undervalues” the company. Numis Securities, the broker, said that the latest rejection was an “immensely brave decision”. GCap said that the revised offer did not reflect the fact that its stations were “unique assets”.

Last year Global, which is an investment vehicle created to buy radio stations, acquired the radio assets of Chrysalis for £170 million. It is backed by a number of private Irish investors.

Ms Hazlitt has moved away from DAB radio, with the closure of stations Planet Rock and theJazz and the sale of GCap's stake in Digital One.

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