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* Top investors Fosun, Axa raise bid to 17.5 euros/share
* Club Med board accepts improved offer
* Board-represented investors to tender their shares
By Dominique Vidalon
PARIS, June 25 (Reuters) - A Chinese investor and a French private equity firm have won over Club Med with an improved 557 million euros ($729 million) takeover bid, seeking to accelerate a shift at the holiday resorts pioneer to fast-growing emerging markets.
China's Fosun International and AXA Private Equity , who have teamed up with Club Mediterranee management and are already the firm's biggest shareholders, said on Tuesday they would pay 17.5 euros a share for the stock they do not already own, up from their previous offer of 17 euros.
Club Med's board said it would back the deal and several of its top shareholders pledged support after staying mum on the previous offer. One small shareholders' group had called the initial price too low.
At 1100 GMT, Club Med shares were up 0.8 percent at 17.45 euros, close to the agreed offer price, although well below their 2007 high of almost 50 euros.
Founded in 1950 and listed since 1966, Club Med was a pioneer of the all-inclusive holiday resort.
But it fell on hard times in the past decade because of stiff competition and an unsuccessful expansion into services. A more recent drive to recast itself as an upmarket operator has been hampered by a flagging European economy.
Fosun and Axa, along with Chief Executive Henri Giscard d'Estaing, plan to accelerate Club Med's expansion in markets such as China to help it cope with tough trading in Europe, where it still makes over 70 percent of its revenue.
The company has said it aims to operate five villages in China by 2015, including three by the end of this year.
Beyond China, Club Med is speeding up expansion in Russia and Brazil, with the goal to lift the contribution of emerging markets to sales to 33 percent by 2015 from around 25 percent.
The firm, which operates around 70 resorts worldwide, competes with global hoteliers including Intercontinental and Accor, as well as tour operators such as TUI Travel and Thomas Cook
The new offer represents a 26.4 percent premium to the closing price on May 24, the day before the initial bid was announced, and was described by a source close to the bidders as "a gesture to win the backing of all shareholders".
ADAM, a minority-shareholder advocacy group, told Reuters last month it had been approached by some small shareholders unhappy with the 17 euros a-share bid.
ADAM could not immediately be reached for comment.
Shareholders represented on the board and holding a combined 14.9 percent of Club Med capital have decided to tender their shares to the raised bid, Club Med said in a statement.
Because the buyers hold a combined 19.33 percent stake, this means they have already secured 34.23 percent of Club Med's capital. The offer will be declared successful if the bidders secure at least 50 percent of the capital.
Under the buyers' plan, a joint venture 46 percent owned by Fosun, 46 percent by Axa Private Equity and 8 percent by 400 Club Med managers will control the resorts operator.
Fosun's interests also include insurance and mining.
Shareholders including Caisse de Depot et de Gestion du Maroc, which has a 7.1 percent stake, have decided to tender their shares, AXA Private Equity and Fosun said in a statement.
Other top shareholders that have accepted the offer include Saudi conglomerate Rolaco - with a 5.6 percent stake - and Italy's Holding Edizione Benetton - which holds 2.2 percent.