By Joe Hoppe

A U.K. regulatory body said Monday that it will start an auction process for Vectura Group PLC after Philip Morris International Inc. raised its offer for the company above that of a rival offer from Carlyle Europe Partners V.

The Takeover Panel said that given neither offer for the pharmaceutical company was final and both may be revised upward, it will hold auction procedure beginning on Tuesday. Earlier Monday, Philip Morris raised its offer to 1.02 billion pounds ($1.42 billion), trumping Carlyle's offer on Friday of GBP958 million.

The auction will last for five days of public bidding, and Vectura, Carlyle and Philip Morris have each agreed to the procedure.

Vectura said it has withdrawn its intention to recommend accepting Carlyle's offer, and it won't at this stage say that it intends to recommend the Philip Morris offer, given the coming auction.

Philip Morris raised its bid earlier Monday to 165 pence a share in cash, up from its previous offer of 150 pence a share and Carlyle's offer of 155 pence Friday.

On Friday, Vectura said that it had agreed a new GBP958 million takeover by Murano Bidco Ltd., a new company indirectly controlled by funds managed by Carlyle Europe Partners V, and withdrew its recommendation for Philip Morris' proposal.

Shares in Vectura at 0853 GMT were up 6.8 pence, or 4.2%, at 170.8 pence.

Write to Joe Hoppe at joseph.hoppe@wsj.com

(END) Dow Jones Newswires

August 09, 2021 05:14 ET (09:14 GMT)

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