UPDATE 2-Laxey agrees to buy UK's TDG for $403 mln

(Adds additional deal details, updates shares.)

By Hsu Chuang Khoo

LONDON, July 4 (Reuters) - British logistics and supply chain firm TDG plc TDG.L agreed on Friday to be bought by Bidco, a company formed by hedge fund Laxey Partners, for 203 million pounds ($403 million), boosting TDG's shares.

Under a larger plan, Bidco will go on to become a private equity investor in undervalued small and mid-size companies such as TDG, and will apply to be listed on London's junior AIM market some time from October.

Laxey's offer of 250 pence in cash for each TDG share is lower than its initial bid of 275 pence in February and comes after rival bidder, British supply chain group Wincanton (WIN.L: Quote, Profile, Research), pulled out of the race last month.

While TDG said the offer was an 11 percent premium over its closing price the day before talks were announced, they are some way off its 320 pence high reached in May 2008.

Under a related proposal, Bidco will also buy all the shares in The Laxey Investment Trust plc LAX.L (TLIT).

TDG shares rose 9 percent to 243.25 pence, while TLIT surged 22 percent to 111 pence at 0831 GMT.

Laxey, which already controls about 22 percent of TDG, said it plans to help it develop TDG's property portfolio.