ATLANTA (Reuters) - Manufacturer Furniture Brands International Inc (FBN.N: Quote, Profile, Research) on Monday urged its shareholders to reject board candidates nominated by private equity firm Sun Capital as a proxy fight intensifies.

In a letter to shareowners, the maker of Broyhill, Thomasville and Lane furniture cited potential conflicts of interests should Sun Capital submit an acquisition proposal.

In February, Sun Capital said it was willing to buy Furniture Brands at a "substantial premium" to the current stock price, which at that time was $10.18. In Monday's letter, Furniture Brands said the firm had suggested a price of $13 to $15 a share, but never followed up with a written offer.

The stock, which Morgan Keegan had upgraded on Monday, was up 53 cents, or 4 percent, at $13.65 in morning New York Stock Exchange trade.

"Sun's desire to buy Furniture Brands at a price that doesn't capture its full value -- is contrary to your interests," the company's letter to shareholders said.

Sun Capital should not obtain access to confidential information, the letter said, since the firm owns stakes in rival furniture companies.

Morgan Keegan analyst Laura Champine raised her rating on Furniture Brands shares to "market perform" from "underperform," saying Sun Capital was "making a determined push to radically transform" or possibly buy the company.

Given the proxy fight and the decline in Furniture Brands shares in recent years, "we believe there is a possibility of larger shareholders voting in favor of Sun's board nominations," Champine said in a research note.

Last week, Sun Capital nominated three people to the Furniture Brands board. The firm, which holds a stake of about 9.5 percent, also said the company should be open to options, including a takeover by a third party.