Spanish company Acciona last week offered $700 million in a friendly takeover of Pacific Hydro, which has been supported by the Australian company's board.

But Acciona's offer of $4.50 a share has a 90% acceptance condition and Development Australia Fund (DAF), part of the Industry Funds Management (IFM) group, which owns 31.73% Pacific Hydro, doesn't want to sell.

IFM executive chairman Garry Weaven told the ABC's Inside Business program that the group was looking at joining together with Acciona's bid or even making a counter bid for Pac Hydro.

Weaven said IFM had been talking with Acciona during the week.

"We're very carefully looking now at putting a proposal to them, but we don't at this point have any strong view that we will be able to reach an agreement," Weaven told Inside Business.

If a deal was reached with Acciona, IFM was hoping to invest in other renewable energy projects outside of Australia, according to Weaven.

But IFM also had the financial capacity to make a bid entirely on its own, even if that meant offering more than $700 million, Weaven said.