Peel Holdings will pay £631.7 million for Harworth Group after the regeneration company's board dropped its opposition and recommended a best and final cash offer.
The offer of 187p a share is an 8.4% increase on Peel's original bid in August and follows a raised offer of 177.5p earlier this month.
It represents a 30.2% premium to Harworth's closing price of 143.6p on 5 August, the day before the bid emerged.
Peel, the property and infrastructure group controlled by the Whittaker family, has also agreed to buy a further 72 million Harworth shares at 187p.
Once those purchases settle on 29 September, Peel will own or have acceptances for 52.1% of Harworth and expects to declare the offer unconditional.
The board had previously rejected Peel's approach, but said the new terms were fair and reasonable.
Directors cited a weak economic backdrop and poor liquidity in the shares, made worse by a concentrated shareholder register.
They also noted Harworth's shares had closed at or below 187p on 98.2% of trading days over the past five years.
The offer sits at a 10.4% discount to Harworth's diluted net disposal value, a measure of net assets, of 208.8p per share at the end of June.
That compares with an average discount of 28.2% over the past three years.
Peel argued Harworth faces falling net assets, higher borrowing, weaker cash flow and lower sales volumes.
It said shareholders could face a share price well below 187p if the offer lapsed.
The bid will be funded from Peel's own cash and loans arranged by HSBC and NatWest.
Peel intends to delist Harworth if it reaches 75% of the voting rights, and to buy out remaining holders compulsorily at 90%.
Shareholders have until 1pm on 25 October to accept.
