Ong's bid vehicle 98 Holdings, backed by the government investment group Temasek Holdings, and other private investors, raised its offer for NatSteel to S$2 per share in cash from the original S$1.93.

Temasek has a 23.58 percent stake in NatSteel, including a direct holding of 8.01 percent.

"We want to bring this to a conclusion. We hope that the shareholders will accept," David Ban, a director at 98 Holdings told Reuters on Monday.

NatSteel shares, which ended last week at S$2 climbed further on Monday after the new offer from Ong. At 0808 GMT, the shares were up one percent to S$2.02.

The fresh bid from Ong, better known for his ownership of swanky hotels such as the Metropolitan and the Halkin Hotels in London and the Four Seasons in Singapore, values NatSteel, at S$772.6 million (US$433.4 million).

Ong's offer is also now 5.3 percent higher than a management buyout offer from Crown Central Assets Ltd, led by NatSteel President Ang Kong Hua, which had valued the assets of the group at about S$1.90 per share.

Ang was not available for comment.

Analysts said NatSteel's key attraction was its overseas operations, particularly its three steel mills in China, where the group is making good profits.

"I'm making money in China. The Chinese steel industry is the world's largest and a good part of the industry is obsolete," Ang was quoted saying in March when NatSteel posted its 2001 results.

He said the group was considering expanding existing plants in China and new investments in the western part of the country.

SHARES MOVE HIGHER

NatSteel stock has surged 25.3 percent since the management buyout offer was made in June.

Most analysts do not think that there would be a counter offer from Ang, who has remained tight-lipped since 98 Holdings came into the picture.

Kim Eng Ong Asia Securities analyst Albert Goh said it was unlikely that Crown Central's Ang would make a counter bid considering that it has raised its offer once.

Ang raised his offer to $1.90 per share on August 17. "They've raised it before and I don't think they'll do it again. I think shareholders will be better off selling in the open market," Kim Eng's Goh said.

Ong also has to think whether corporate raider Oei Hong Leong, who snapped up 11 percent stake in the steel maker by buying shares in the open market two weeks ago, would make a bid.

Oei, the son of the founder of Indonesia's Sinar Mar Group, Oei Ek Tjong, paid nearly S$80 million and is now the single largest shareholder of the company.

Oei has been quiet about his intentions but if he sells out to Ong at the new price of S$2.00, he would be walking away with about S$1.30 million in profit.

98 Holdings' Ban said his group had not spoken to Oei nor had plans to talk to the Singapore-based businessman regarding the latest offer.

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