The board of the Anglo Dutch steel maker, Europe's second largest, has postponed its shareholders meeting, earlier scheduled from 4 December to 20 December, to enable Brazilian steel maker CSN more time to put up a counter bid to the Tata offer. (See: Brazil's CSN ups Tata offer with $8.1-billion rival bid for Corus)

The board had earlier scheduled the meeting for 4 December to get a shareholder vote on the 455 pence a share offer from Tata Steel, that it had announced its backing for. (See: Corus chief supports Tata Steel offer at European industry meet)

Goldman Sachs, which has extended a credit line to finance CSN's bid for Corus Group, and UBS, which is advising CSN in its bid, have reportedly hiked their holdings in Corus. While funds managed by Goldman Sachs have reportedly picked up close to 4 per cent, UBS has reportedly hiked its investments to nearly 7.5 per cent from just over 6 per cent.

CSN had declared last week that it has picked up a 3.8 per cent stake in Corus through open market purchases. In addition, CSN's main banker Barclays holds a 4.7 per cent stake in Corus. As a result, CSN, its bankers and financial advisors together hold nearly 20 per cent of Corus Group.

This is seen as a smart move by CSN to get enough shareholder support and force the Corus board to back its offer. The Corus board cannot ignore the wishes of shareholders who hold a combined 20 per cent stake in the company. Other minority shareholders may also be influenced by this group and decide to wait for a much higher bid by Tata Steel.

Standard Life Investments remains the single largest investor in Corus with a stake of 7.8 per cent. Standard Life had expressed dissatisfaction at the price offered by Tata Steel without giving any indications about an acceptable price.

CSN chairman Benjamin Steinbruch is currently in London with 40 of his key executives to formulate a firm offer for Corus Group. The due diligence by CSN is progressing and is expected to be completed by this weekend or by early next week. CSN would come out with a firm bid before Corus shareholders meet on 04 December to discuss the Tata Steel offer, according to a report in the Financial Times.

"Depending on the quality of the information, discussions will be finalised at the end of this week or beginning of next week. We would like to be prepared before the Corus EGM. We are confident that we will be able to move to a formal bid," Steinbruch told the Financial Times.

Meanwhile, Tata Steel remains noncommittal on its future moves. The company's board met at Mumbai last week, but no official announcements have been made so far. Earlier the company had discussed ite additional requirements with its bankers if it wanted to raise its bid. Analysts expect Tata Steel to raise its bid by a maximum of $1 billion.

Tata Steel is understood to have already indicated to the Corus board its readiness to match the CSN offer. That may encourage Corus to reject the CSN bid and stick with Tata Steel. If CSN gets the support of the Corus board, Tata Steel is reportedly ready with a 'killer bid', which would be high enough to dissuade CSN from considering any further counter-offers.

Most analysts expect the higher bid to be close to the current market price of 505 pence per share of Corus. Tata Steel has currently bid 455 pence per share while CSN has said it is ready to offer 475 pence, subject to due diligence and the full backing from Corus board.