UPDATE 1-DNO raises Faroe Petroleum stake to 43 pct, extends bid deadline

Norwegian oil firm DNO has raised its stake in Britain's Faroe Petroleum to about 43 percent, it said on Thursday, falling short of the 57.5 percent needed to give it an unasailable majority shareholding. Faroe's board and management have repeatedly rejected DNO's 610 million pounds ($768.60 million) takeover offer as hostile and inadequate, arguing that it substantially undervalued the Aberdeen-based company.

DNO, which held close to 30 percent of Faroe's shares before making its move, said it will now extend the deadline for owners to accept the bid of 152 pence per share until Feb. 16. Faroe's share price closed at 146 pence in London on Wednesday. As the British firm has the ability to issue shares that could dilute existing owners, DNO would need to get a stake of a minimum 57.5 percent, plus one additional share, to be certain of winning a majority holding. ($1 = 0.7937 pounds)