Australia-based Sigma Pharmaceuticals has asked Aspen Pharmacare to improve its A$648m ($567m) takeover bid, but refused to extend exclusivity of negotiations to the South African company.
Sigma remains Australia’s leading generic drug producer, but has struggled with debt issues and increased competition.
On 7 July, Aspen reduced its offer by 8% to A$0.55 per share, well below the A$0.75 per share valuation made by broker JP Morgan.
Analysts have said, however, that the valuation could change when Sigma's outlook is clearer, given the company's warning two weeks ago that its forecasted profit of A$80m for the year to January 2011 would be difficult to achieve.
Simon Marais, chief investment officer of Orbis Investment Bank, which is Sigma's second largest shareholder, said that the board was doing the right thing but should give shareholders the chance to examine Aspen's offer.