* Improved bid meant to offer exit to arbitrageurs-Capgemini CEO
* Capgemini wants to 'kill market rumours' on higher bid-CEO
* Consultancy group rules out making any new bid for 18 months (Adds quotes, details from call with Capgemini CEO)
By Mathieu Rosemain and Piotr Lipinski
Jan 14 (Reuters) - French consulting and IT services provider Capgemini slightly raised the price of its friendly bid for smaller rival Altran Technologies on Tuesday, in a last-ditch effort to win a six-month battle against U.S. activist fund Elliott.
The firm, which had thus far said its 3.6-billion-euro ($4 billion) bid for all of Altran reflected a fair value for the target, is now offering Altran shareholders 14.5 euros per each share they hold, compared to 14 euros previously.
This represents an addition of 128 million euros to the initial bid, which Capgemini said would be final.
The Paris-based group ruled out any possibility that it might further raise the bid for at least 18 months.
"I'm trying kill all the rumours that say: let's wait, there will be something better tomorrow. There won't," Capgemini Chief Executive Paul Hermelin said in a call with reporters. "We've closed off all possibilities of something better tomorrow."
Capgemini decided to raise its offer because Altran's shares are already trading above 14 euros on market rumours that the group might be ready to increase its offer, Hermelin said.
He notably pointed to some arbitrageurs who were betting on an improvement of the bid.
Hermelin said he was ready to explain his rational to Elliott but that his intent had never been to negotiate with the activist fund.
The group's aim remains to reach a self-imposed threshold to get backing from just over half of Altran's investors. It ruled out the possibility of offering a higher price beyond that threshold to be able to fully merge with Altran.
Altran shareholders now have just up to Jan. 22 to tender their shares.
Elliott, which has gradually built a 14% stake in Altran since last summer, declined to comment. Capgemini holds an 11.43% stake in Altran, making it the second-biggest shareholder.
In an interview with Reuters in November, Hermelin had said his group would stick to its bid of 14 euros per share for Altran.
Hermelin said that if his offer on Altran failed, he would seek partnerships with other groups, notably in the field of the next generation of mobile technology, or 5G.
Capgemini is hoping the deal will add to its services in industries from telecoms to aerospace, and help it slash costs. Its initial offer represented a 22% premium to Altran's share price on the day it was announced. ($1 = 0.8986 euros) (Reporting by Piotr Lipinski in Gdansk and Mathieu Rosemain in Paris; Additional reporting by Gwénaëlle Barzic in Paris; Editing by Jan Harvey and Bernadette Baum)