Paint maker DuluxGroup says it has increased its stake in takeover target Alesco to about 41 per cent.
Argo Investments has agreed to sell its 2.4 per cent interest in building products maker Alesco to Dulux.
Alesco's board is opposed to the takeover offer.
It says the $210 million offer of 2.05 a share in cash plus 18 cents in franking credits is too low and "undeliverable".
Alesco shares closed steady at $2.06 while DuluxGroup dropped four cents to $3.24.