* KKR has cut indicative offer to A$3.40 from A$3.77
* Private equity firm will vote for any higher offer - MYOB
* MYOB shares up 15 percent in a steady broader market (Adds shares, broker comment)
By Byron Kaye
SYDNEY, Dec 24 (Reuters) - Australian accounting software maker MYOB Group Ltd said it would back a marked-down A$1.6 billion ($1 billion) buyout offer from private-equity giant KKR & Co in a bid to navigate a broader market turmoil, sending its shares higher.
The decision marks a swift change of heart for the Sydney-listed mainstay of Australian small businesses that just four days earlier suggested it could not go ahead with the U.S. firm's lower bid.
MYOB said in a statement on Monday it would now recommend the offer, given a 10 percent drop in the Australian equity market since KKR first made a higher indicative bid in October, and the cost of a company restructure still underway.
"We believe it is in the best interests of shareholders to put and recommend this transaction to shareholders having regard to market uncertainty and the longer-term nature of the strategic growth plan," Chairman Justin Milne said.
KKR already owns 20 percent of the target but would vote in favour of any higher offer that MYOB can find, MYOB said.
KKR was not immediately available for comment.
"There won't be a better bid," said Stuart Smith, private client adviser at Bell Potter Securities.
MYOB shares were up 15 percent by mid-session, while the broader Australian market was flat.
The A$3.29 trading price was, however, still below KKR's latest A$3.40 indicative offer price, a sign of uncertainty about whether a formal offer would eventuate.
KKR initially suggested paying A$3.70 per share for MYOB then raised it to A$3.77, prompting the Australian firm to give KKR access to its financial records for due diligence.
But KKR later slashed the offer amid a broader sell off in global technology shares, with majors like Facebook Inc and Google owner Alphabet Inc slipping on concerns about incursions on privacy.
When MYOB went public in 2015, it sold its shares at an issue price of A$3.65. Still a dominant provider of accounting software in Australia, it has recently been struggling to compete for market share with cloud-based New Zealand rival Xero Ltd. ($1 = 1.4194 Australian dollars) (Reporting by Byron Kaye in SYDNEY and Nikhil Kurian Nainan in BENGALURU; Editing by Jane Merriman, Dan Grebler and Himani Sarkar)