A bidding war is breaking out over military trainer and C4ISR provider Cubic, with a new bid worth hundreds of millions of dollars more emerging from Singapore Technologies (ST) Engineering, Cubic acknowledged March 22.

On Feb. 7, Cubic, of San Diego, had agreed to be taken private by Veritas Capital and Evergreen Coast Capital, an affiliate of Elliott Investment Management. The latter, an activist hedge fund, had been pressuring Cubic since last summer. Terms of that deal called for Veritas and Elliott to pay Cubic $70 per share.

But apparently ST Engineering has issued an unsolicited offer of $76 per share. The new offer was worth roughly $2.4 billion compared with the earlier deal now worth around $2.2 billion.

In turn, while Cubic’s board is still officially encouraging Cubic shareholders to agree to the Veritas-Elliott offer, Cubic’s board also has agreed to talk further with ST Engineering. “Cubic’s board of directors has determined that the STE proposal is or would reasonably be expected to lead to a superior proposal, as that term is defined under the Veritas merger agreement,” Cubic said.

Singapore Technologies Engineering is based in the Asian city-state of the same name. It is not immediately clear whether a takeover faces additional scrutiny. But ostensibly, a foreign buyout of U.S. defense contractor Cubic could require an additional national security review that has been toughened in Washington in recent years.

Before the Veritas-Elliott offer, Cubic’s shares were trading at around $63 apiece. After the first offer was announced, Cubic’s shares have been hovering around $70. With the new offer, Cubic’s shares jumped 8% to around $75.

The new proposal contemplates that, immediately following the acquisition of all of Cubic’s outstanding stock, ST Engineering would sell the Cubic Mission and Performance Solutions segment to an affiliate of Blackstone Tactical Opportunities. The segment was created last year by combining Cubic’s mission services and defense business as Cubic sought to shore up its business model.

J.P. Morgan Securities has been acting as lead financial advisor to Cubic and Sidley Austin and Faegre Drinker Biddle & Reath were the company’s legal counsel. Raymond James & Associates has provided the Cubic board with an opinion regarding the fairness, from a financial point of view, of the Veritas deal offered to Cubic shareholders.