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UPDATE 1-TPC Group gets higher buyout offer from Innospec

* Potential offer at $44 to $46 per share in cash

* TPC says will consider the non-binding proposal

(Adds details)

Oct 8 (Reuters) - Chemicals maker TPC Group Incsaid it received a buyout proposal from Innospec Inc ,valuing the company at up to $721 million, topping an offer madeby private equity firms First Reserve Corp and SK CapitalPartners.

Specialty chemicals company Innospec could offer $44 to $46per share in cash, TPC said in a statement on Monday. FirstReserve and SK Capital offered $40 in late August.

The stock, which closed at $40.67 on the Nasdaq on Friday,has consistently traded above the price offered by the privateequity firms, and at least two top-10 shareholders have saidthey will vote against the deal.

TPC said it will consider the non-binding proposal fromInnospec. It had said a transaction with First Reserve and SKCapital Partners would be in the best interest of shareholders.

TPC's main product is butadiene, used in making syntheticrubber for tires and other automotive products, but its businesshas come under pressure this year as prices for butadiene havefallen sharply because of weak demand.

Perella Weinberg Partners LP is advising TPC.

(Reporting by Krishna N. Das in Bangalore; Editing by DonSebastian)

((krishna.das@thomsonreuters.com)(within U.S. +1 646 223 8780 x5798, outside U.S. +91 80 4135 5800)(Reuters Messaging:krishna.das.thomsonreuters.com@reuters.net))

Keywords: TPCGROUP OFFER/INNOSPEC