(Adds quotes, details from deal opponent)
Nov 17 (Reuters) - Marathon Petroleum Corp raised for the second time the cash portion of its offer for U.S. natural gas processor MarkWest Energy Partners LP by $210 million to $1.28 billion, nearly double what it had offered initially.
The two companies said on Tuesday Marathon would now offer $6.20 in cash and 1.09 units of its pipeline master limited partnership MPLX LP for each MarkWest unit.
However, the value of the total offer has fallen to $10.38 billion as of Monday from $15.6 billion when the deal was announced on July 13 as MPLX shares have dropped nearly 40 percent since then.
Marathon first raised the cash portion of its offer to $5.21 per unit on Nov. 10 from $3.37 in July, after MarkWest shareholder and former chief executive John Fox said the deal would lead to a 46 percent cut in cash distributions to unitholders.
In a call to investors and analysts later on Tuesday, Fox reiterated his opposition to what he called a "fundamentally bad deal."
"You can't make a bad deal a good one and then use your $6 to cover all the sins of omission here, I guess," he said. It's a drop in the bucket. It is dwarfed by the stock price decline."
The acquisition will create the fourth-largest master limited partnership, which is a limited partnership that is publicly traded on an exchange.
The total offer now translates to $51.74 per unit, a 14 percent premium to MarkWest's Monday close, but lower than $78.64 in July.
Fox, who holds 0.7 percent stake in MarkWest, said it should remain a standalone company. In particular, he said Marathon aims to pull $2 billion from the merged company through incentive distribution rights (IDRs), cutting the current distribution, with a promise to restore it over the next several years.
"This deal is far more important to Marathon Petroleum than it is to MarkWest," Fox said.
However, Marathon said Kayne Anderson Capital Advisors LP, Tortoise Capital Advisors LLC and the Energy & Minerals Group - three of MarkWest's largest unitholders with more than 15 percent combined - have agreed to vote in favor of the deal.
MarkWest unitholders are slated to vote on the deal on Dec. 1.
Reporting by Kristen Hays in Houston and Amrutha Gayathri in Bengaluru; Editing by Kirti Pandey and Alan Crosby