Spectris PLC (LSE:SXS) shares skyrocketed 60% on Monday afternoon after the FTSE 250 group said it had received a £3.7 billion bid from private equity group Advent.
A "conditional proposal" has been made by Advent International about a possible cash offer at 3,763p per share, compared to the closing price of 2,038p last week.
An eventual final offer, which depends on due diligence being carried out, would include a proposed interim dividend of 0.28p per share.
Advent made "a number" of approaches previously, Spectris said, but until now its board had batted them away.
If a firm offer is made at the latest proposed value, the board "would be minded" to recommend it unanimously to shareholders, it said.
"Accordingly, the board is in discussions with Advent in relation to these terms and has provided access to confirmatory due diligence."
Under London takeover guidelines, Advent has until 5pm on 7 July to make a firm offer of walk away.
"There can be no certainty that an offer will be made," Spectris stressed.