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Tesco has received regulatory clearance for its proposed acquisition of the Dobbies garden centre chain.

Revealing the decision by the Office of Fair Trading (OFT) to approve the planned takeover, the supermarket chain also urged Dobbies shareholders who have yet to accept its 1,500 pence a share offer for the business to do so.

In addition Tesco announced that it was exercising its call option to buy a further 16.4 per cent stake in its takeover target, taking its total share in the Scottish-based business to 28.1 per cent.

The retailer confirmed that Dobbies shareholders will now have until 13:00 BST on Wednesday to accept its £155.6 million offer for the UK's third-largest garden centre chain.

Last month Tesco's was forced to push back the deadline after revealing that it had secured the support of just 32.2 per cent of Dobbies' investors for the deal.

"The offer will remain open for acceptance until 13:00 BST on August 8th 2007 and Dobbies shareholders who have not yet accepted the offer are urged to do so as soon as possible and in any event by August 8th 2007," said Tesco today.

Speculation has arisen that Scottish property magnate Tom Hunter could make a rival bid for Dobbies, which operates 21 outlets across England and Scotland.

In June he increased his stake in the garden centre chain to 25.57 per cent in a move many saw as an attempt to scupper Tesco's takeover plans.

But the offer for Dobbies put forward by the supermarket chain remains the only one on the table at present.

Tesco's has said that its planned acquisition of the company would provide it with a "new source of growth" and has emphasised the potential of the bid to help Dobbies to "increase access to environmentally friendly products at keener prices, allowing more customers to make a greener choice".