A hostile takeover bid for industrial services company Spotless Group appears to have stalled, with the private equity suitor unwilling to meet a demand to increase its offer.

Spotless has asked Pacific Equity Partners (PEP) to lift its offer by about $32 million before allowing PEP access to its accounts for due diligence.

But PEP on Tuesday said it had not been given any justification for an increased bid, and would not improve the offer without gaining access to the Spotless books.

“PEP is unable to progress the revised proposal without access to due diligence,” it said in a statement.

PEP originally offered $2.63 for each Spotless share, before revising the offer to $2.68, valuing Spotless about $711 million.

But the cleaning and hospitality services company said earlier it would only recommend to its shareholders an offer of at least $2.80 per share, which values the company at $743 million.

That request appears to have surprised PEP, which said discussions in December provided no justification for a valuation above the proposed $2.68 per share.

The $2.68 offer remains a highly attractive proposition, as it represents a premium to the three month volume weighted average price of Spotless shares, PEP said.

And it already has significant shareholder support for its offer, with 26 per cent of Spotless shareholders having signed pre-bid agreements.

PEP said it could complete its due diligence process in four weeks, and wants to progress the takeover proposal process as quickly as possible.

Spotless shares dropped two cents to close at $2.35.