Briscoes' (BGR) stake has grown from 19.9% to 22.17%, a gain of about 10%, or 4.57million shares, since it launched the hostile $362.2million cash and scrip bid in early July.
However, the offer closes on Thursday and is far short of the 90% stake it requires for a full 100% takeover.
BGR managing director Rod Duke is already talking of the potential for another merger offer ''at some stage in the future, regardless of whether our current takeover offer succeeds''.
''We're obviously disappointed in the low acceptance level in response to our offer,'' he said in a statement yesterday.
Craigs Investment Partners broker Peter McIntyre said the ''scrip-heavy'' offer did not appear to be appealing to shareholders.
The $362.2million offer is an implied $1.80 per share, made up of five Briscoes shares for every nine Kathmandu (KMD) shares, plus a 20c per share cash component.
''There's a reluctance to take scrip.
''It's been a slow uptake, with no compelling evidence for shareholders to accept the offer,'' Mr McIntyre said.
He cautioned that BGR could come back another time with a new offer, which could be even lower. KMD's board had rejected the offer as opportunistic, and a separate independent report valued KMD's shares in a range of $2.10 to $2.41.
Mr Duke said as KMD's largest shareholder he wanted to see its performance improve and for the value of BGR's 20% stake in Kathmandu to rise.
''But we see little chance of a turnaround sufficient for the directors' published forecast of a $30million profit after tax for their 2015-16 financial year, a 50% increase, to be achieved,'' he said.
''We still believe that a merger of Briscoe Group and Kathmandu could be structured to be a significant win-win for both companies' shareholders, and are open to the idea of progressing a merger,'' Mr Duke said.
