(Reuters) -Australia's Boral ( BOALF ) on Tuesday recommended investors reject its largest shareholder Seven Group Holdings' A$1.9 billion ($1.25 billion) offer for the company claiming it undervalues the building products group.

Seven Group, controlled by billionaire Kerry Stokes and his family, already owns nearly 72% of Boral ( BOALF ) and had launched a bid last month to acquire full control of Boral ( BOALF ).

The proposal of a minimum of A$6.05 per Boral ( BOALF ) share consists of 0.1116 Seven Group shares and A$1.50 cash. The offer could go as high as $A6.39 per share if certain acceptance rates are met.

Grant Samuel, the independent expert firm, assessed fair value for Boral ( BOALF ) in the range of A$6.50-A$7.13 per share, the company said.

The Seven offer values Boral ( BOALF ) at A$6.67 billion ($4.35 billion) and represents a 3.4% premium to its last closing level of A$5.850 on Feb. 16 before the bid arrived.

Seven Group did not immediately respond to a request for comment.

Seven earlier said it would raise the offer by another 10 Australian cents if it gained an aggregate 80% stake in Boral ( BOALF ) or if Boral's ( BOALF ) board unanimously recommended the offer to its shareholders, or both.

The offer would increase by another 10 cents if Seven Group's stake reaches 90.6%, the compulsory acquisition threshold.

Grant Samuel concluded Seven Group's offer was "not fair and not reasonable", after which all Boral ( BOALF ) directors other than Seven Group nominees intend to reject the offer, the company said in a statement.

Boral ( BOALF ) said only 11.66 million shares had accepted the Seven offer since it opened on March 4, representing 1.06% of its total issued shares.

($1 = 1.5253 Australian dollars)