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Play for Steinway becomes a duet as new bidder emerges

An employee planes a sound board support at the Steinway & Sons factory in the Queens borough of New York.
Daniel Acker | Bloomberg | Getty Images
An employee planes a sound board support at the Steinway & Sons factory in the Queens borough of New York.

Steinway Musical Instruments, a 160-year-old maker of pianos, saxophones and trumpets, said it received a takeover offer from an investment firm it did not identify that topped a bid by private-equity firm Kohlberg & Co.

Steinway shares rose more than 8 percent on Monday, more than a dollar above the new offer price, indicating that some investors expected a higher offer.

The company said only that the new bidder managed more than $15 billion.

Steinway said in December that it had decided not to sell itself after a 17-month-long review of strategic options.

(Read more: Is it time for an Aviva takeover)

Six months later Kohlberg made an offer of $35 per share, valuing the company at about $438 million. The latest offer values Steinway at about $477 million.

Steinway said on Monday its board had determined that the new offer was superior to Kohlberg's.

Kohlberg has the option to improve its offer.

(Read more: Why KPN bid may be all about Germany)

Steinway's pianos have been used by legendary artists such as Cole Porter and Sergei Rachmaninoff and by contemporary ones such as Chinese concert pianist Lang Lang.

But the Waltham, Massachusetts-based company's sales have been stagnating and it has struggled to keep production margins competitive. Sales rose just 2 percent in 2012

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