Caltex Australia has rejected a $3.9 billion-plus buyout proposal from Britain's EG Group.

Caltex says the bid undervalued the company, but suggested it would be open to more talks for a potential transaction.

EG Group made an offer that included AU$3.9 billion in cash and separate shares in a new, listed infrastructure and refinery company comprising Caltex's remaining assets.

Just days before, Canada's Alimentation Couche-Tard's made an AU$8.80 billion bid.

Caltex Australia’s interim CEO Matthew Halliday is in charge of evaluating the two proposals.

The bidding war has erupted as Caltex works to boost margins from its refining business and its fuel and convenience store businesses.

It is also planning a public listing of a property trust with around 250 of its petrol station sites.