The Securities and Exchange Board of India may allow Grasim Industries' open offer for Larsen & Toubro stock to go through though at a higher price.

Sources familiar with development said the regulator had indicated to the AV Birla group company the open offer could be allowed, but at a higher price. Grasim had made an open offer to buy L&T stock at Rs 190 a share.

Sebi officials, however, said they were unaware of the development. Since Grasim has appealed against the Sebi order suspending its open offer, it will have to withdraw the case if it accepts the terms of the fresh offer, especially the price.

Sebi Chairman G N Bajpai has indicated the Grasim-L&T case report will be ready in two weeks.

Sebi asked Grasim to suspend its open offer after investor forums complained to Sebi that the offer price was low. Sebi, persuaded by the Securities Appellate Tribunal order asking it to reopen the ACC acquisition by Gujarat Ambuja Cement, decided the two cases were similar.

It ordered an investigation into Grasim's purchase of a 10.72 per cent stake in L&T from Reliance Industries and whether it had led to a change in management control.

Grasim appealed against the Sebi directive to stop the open offer pending investigation, and the tribunal ruled in the regulator's favour.