Shane Ross, chairman of the Kleinwort fund (Kepit) wrote yesterday to its 65,000 shareholders urging them not to accept the improved offer from TR European (Treg) until his board had considered all other options.
Mr Ross said the Treg offer's value was "wholly uncertain" because it meant liquidating Kepit's assets at a heavy discount to market prices, with shareholders bearing the costs of the liquidation and fees to Treg's advisers.
He added that Kepit directors, along with advisers Merrill Lynch, were studying details of all the 10 expressions of interest to see which was most suitable.
But his letter drew a further attack from Treg, which accused the Kepit board of "re-arranging the deckchairs on the Titanic instead of rescuing shareholders in Kepit". Treg claimed its hotline has received more than 500 calls in the past few days, most of them backing its bid.
James de Sausmarez, retail managing director at Henderson, Treg's manager, said the Kepit board had failed to come up with any alternatives to Treg's bid: "On that basis, their response is inadequate. What we are saying to the Kepit chairman and the board is that it should produce a single detailed proposal to shareholders that offers 100 per cent cash to them."