LONDON (Reuters) -Advertising group M&C Saatchi has rejected an improved takeover approach from the acquisition vehicle of its top shareholder Vin Murria, saying on Monday it still significantly undervalued its prospects.

Murria’s AdvancedAdvT said on Monday it had floated two options, one an all-share offer that values each M&C share at around 220 pence or an alternative structure that includes some cash and values them at around 200 pence.

The paper proposal was deemed to be a 20% increase over its earlier offer, however the independent directors of the agency rejected the offer late Sunday. The 220 pence price – valuing M&C Saatchi at about 270 million pounds ($364 million)- is based on the AdvancedAdvT stock price when it was halted from trading.

M&C shares were up 2.5% at 179.5 pence in morning trading, before falling following the M&C statement.

AdvancedAdvT, the vehicle of the software entrepreneur Murria that is also backed by private equity group Marwyn, has said it would combine its digital capabilities with the brand recognition of M&C, and invest heavily to help it better compete, including with acquisitions.

Founded in 1995 by ad mogul brothers Maurice and Charles Saatchi, M&C has been recovering from a 2019 accounting scandal and argues the offer does not reflect its expected future growth. M&C has stated that it doesn’t see any merit in the deal because it does not provide its shareholders with a premium.

The company stated Monday that it hadn’t received any information about possible takeovers. It also said there wasn’t a guarantee the strategy would work. The company also pointed out that significant corporate changes can cause stress among key staff members, which is a major problem in a service business.

Murria is M&C’s deputy chairman and biggest investor. She owns 12.5% of M&C directly, while AdvancedAdvT owns 9.8%.

AdvancedAdvT made Monday’s statement that it wants to retain Saatchi CEO Moray MacLennan and AdvancedAdvT chief operating officers Gavin Hugill. Vin Murria will be the chairperson, with majority independent directors.

M&C Saatchi in a trading update on Friday lifted its 2021 headline profit before tax outlook, and said a regulatory investigation into the group’s accounting had closed without any enforcement action.

Peel Hunt analysts stated that the firm believed an improved offer was necessary due to the company’s strong trading performance and the closing of its investigation. AdvancedAdvT will have until Feb. 3 to offer a formal deal, they stated.

($1 = 0.7418 pounds)