upgrade to lastest tar from 0.82 and connection fails

I just upgraded to the latest tar of freetds dated december and now I 
cannot connect.

I built freeTDS with:

sh ./configure --with-unixodbc=/usr --enable-iconv 
--prefix=/home/martin/freetds_0_83_dev

my odbcinst.ini is:

[FreeTDS8]
Driver          = /home/martin/freetds_0_83_dev/lib/libtdsodbc.so
Description             = 0.82 version of freetds

my odbc.ini is:

[freetds8c]
Driver          = FreeTDS8
Description             = connection
Trace           = No
# ServerName refers to freetds.conf file
ServerName = baugi

my freetds.conf in /home/martin/freetds_0_83_dev/etc is:

[baugi]
host = baugi.easysoft.local
instance = SQLEXPRESS
tds version = 8
client-charset = UTF-8
#port = 1433

When I run isql -v freetds8c user password all I get is:

isql -v freetds8c sa easysoft
[S1000][unixODBC][FreeTDS][SQL Server]Unable to connect to data source
[ISQL]ERROR: Could not SQLConnect

and tds dump file contains:

14:02:38.680971 25705 (log.c:196):Starting log file for FreeTDS 
0.83.dev.2010122
9
         on 2010-12-31 14:02:38 with debug flags 0xffff.
14:02:38.681015 25705 (iconv.c:330):tds_iconv_open(0x9cfcc18, UTF-8)
14:02:38.681036 25705 (iconv.c:187):local name for ISO-8859-1 is ISO-8859-1
14:02:38.681044 25705 (iconv.c:187):local name for UTF-8 is UTF-8
14:02:38.681050 25705 (iconv.c:187):local name for UCS-2LE is UCS-2LE
14:02:38.681057 25705 (iconv.c:187):local name for UCS-2BE is UCS-2BE
14:02:38.681063 25705 (iconv.c:349):setting up conversions for client 
charset "U
TF-8"
14:02:38.681069 25705 (iconv.c:351):preparing iconv for "UTF-8" <-> 
"UCS-2LE" co
nversion
14:02:38.681078 25705 (iconv.c:391):preparing iconv for "ISO-8859-1" <-> 
"ISO-88
59-1" conversion
14:02:38.681085 25705 (iconv.c:394):tds_iconv_open: done
14:02:38.681091 25705 (login.c:428):invalid port number
14:02:38.681100 25705 (mem.c:615):tds_free_all_results()
14:02:38.681113 25705 (error.c:412):odbc_errs_add: "Unable to connect to 
data so
urce"

Notice the invalid port number. I was not using a port number before, I 
was using an instance.

Any ideas?

Martin