(Adds details on Investa portfolio, background on Oxford Properties Group, spokesman's response)
Sept 6 (Reuters) - The manager of Investa Office Fund (IOF) on Thursday said Blackstone BX.N is prepared to hike its buyout offer by 3.2 percent to exceed one by Canada's Oxford Properties Group, adding fuel to a bidding war for the office landlord.
Investa Listed Funds Management Ltd (ILFML) said Blackstone had informed it in writing that it could go to A$5.52 per IOF unit, adjusting for distributions declared or paid on or after Thursday. Blackstone's previous offer was worth A$5.3485 per unit.
ILFML said its board intended to work with Blackstone to give effect to the price increase, which is a sliver higher than Oxford's A$5.50 per unit offer. It continued to recommend the Blackstone offer unless a superior offer emerged.
Blackstone, in a letter to Investa on Wednesday, said the Oxford offer was "not a superior proposal" and that it reserved its rights to terminate its bid and claim a break fee if the meeting were to be adjourned and Oxford's offer deemed better.
Oxford Properties Group is the real estate investment arm of Canadian pension fund OMERS. An Oxford spokesman in Toronto had no immediate comment in response to Blackstone's new offer on Thursday.
Investa has been a takeover target for years, as tight supply and strong growth lift rents in Australia, especially in Sydney where the company's towers are concentrated.
