AngloGold, defending its ranking as the world's biggest gold miner, has upped its bid in the long-running battle to take over Australia-based Normandy.

AngloGold, based in South Africa, upped its cash-and-stock offer for Normandy by 10 cents a share, valuing the Australian firm at about 4.1 Australian dollars (Aus$).

However, the offer was still below that offered by rival bidder Newmont, a Denver-based firm which is tempting Normandy shareholders with a greater cash element.

A joint Newmont-Normandy company would overtake AngloGold in the world rankings.

With AngloGold's offer having a further two weeks to run, Normandy urged shareholders to await further developments before accepting either bid.

And analysts predicted further developments in a takeover saga which has already been running for almost three months.

"The last card is yet to be played," said Hartley Poynton analyst John Featherby.

"You get the feeling there is still the possibility of the ante being upped again."

Merger wave

The battle comes amid a consolidation wave among gold mining firms, coping with a long-term decline in prices for the metal.

And AngloGold's latest move follows talks with Canadian firm Barrick over carving up Normandy should the bid prove successful.

"AngloGold is sufficiently confident of its capacity to work co-operatively with Barrick to unlock value in certain of the Normandy assets," AngloGold said in a statement.

"AngloGold has co-operated with Barrick in the past, and is presently engaged in discussions with Barrick aimed at identifying synergies that the two companies can realise... globally, but specifically in Australia, and Tanzania."

Newmont said it would respond to AngloGold's raised offer in due course.