A group including private equity firm KKR (KKR.N) and Macquarie Group Ltd (MQG.AX) on Wednesday offered up to A$7.3 billion ($5.47 billion) to buy Australian lottery operator Tatts Group (TTS.AX), threatening a takeover deal with Tabcorp Holdings Ltd (TAH.AX).

Tatts said in a statement that its board had not yet formed a view on how the proposal compared with the Tabcorp offer currently valued at about A$6.03 billion, but two Tatts shareholders said they believed it was a superior deal and could spark a bidding war with the entry of additional players.

The consortium, also including Morgan Stanley Infrastructure and First State Superannuation Scheme, has the advantage of not needing approval from the competition regulator, which is closely examining the offer from Tabcorp, Australia’s biggest bookmaker.

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