The consortium lodged its unconditional offer for the construction company after failing to win a recommendation from the board with an earlier lower conditional bid. The latest 1,075p-a-share cash offer is higher than a previous bid of 1,030p a share from Mars Bidco, a consortium including private equity companies Barclays Capital and Permira.

Keith Lovelock, the chief executive of McCarthy & Stone, says the company had no hesitation in recommending the higher offer that the board considered "fair and reasonable." Meanwhile, a third bidder, property entrepreneur Vincent Tchenguiz, has yet to be ruled out of the process but has not formally bid for the company.

The bids offer a massive premium to the company's net asset value, last reported at 438p a share, in effect ruling out industry interest in buying the company. NAV normally undervalues the actual value of builder's assets by about 30%, because it does not keep up with inflation. Analysts believe the discrepancy stems from the fact that the land on McCarthy & Stone's books is older than that of most traditional homebuilders, because it takes longer to get planning permission for retirement homes. The result is a bigger gap between NAV and actual valuation.