Kathmandu is urging shareholders to sit tight in response to Briscoe Group's takeover offer.
The homeware and sporting goods retailer is offering 5 Briscoe shares for every 9 Kathmandu shares held, and 20 cents in cash per share for the remaining 80.1 percent it does not own.
Broking house, Forsyth Barr said it did not think the bid would succeed, and it expected Kathmandu to reject it.
Analyst Chelsea Ledbetter said the implied offer at $1.76, is below what Kathmandu is worth, which she estimates ranges between $1.89 and $2.50 per share.
She expected the Rod Duke controlled Briscoe to raise its bid and offer more cash.