Sigma Pharmaceuticals Ltd of Australia yesterday revealed that the company behind A$707-million ($579 million) takeover bid was South Africa's Aspen Pharmacare Holdings.

The loss-making OTC drugs and prescription pharmaceuticals maker Sigma is still scouting around for higher bids.

Aspen also confirmed the bid in a regulatory filing with the South African stock exchange on Friday, where it said that the bid was conditional to due diligence, regulatory approvals and unanimous support from the Sigma board among others.

On 21 May, the Melbourne-based Sigma, Australia's largest generic drug maker, revealed that it had received an A$707 million ($579 million) takeover bid from an unnamed company, sending its share soaring by 50 per cent. (See: Mystery bidder offers A$707 million for loss making Sigma Pharmaceuticals) 

Durban-based Aspen with 2009 revenues of $1.1 billion had offered to buy Sigma at A$1.49 billion, comprising A$707 million in issued shares and A$785 million in debt.

Sigma is reported to have hired Melbourne-based investment bank Lazard Ltd to scout for higher offers as it feels that other offshore groups and private equity firms may be interested as well as Indian Pharmaceutical companies like Strides Acrolab and Ranbaxy Laboratories have said in the past that they would like to extend their footprint in Australia.

But getting a better offer than Aspen may not be easy according to analysts as the company lost more than half its value after reporting a full-year loss of A$389 million in March and had its shares suspended from trading for five weeks to 31 March on allegations of accounting irregularities and for making preferential deals with large pharmacy chains at the expense of smaller chemists.

The company had defaulted on debt repayments and creditors were forcing the company to sell of assets in order to pay them A$90 million by 30 November 2009, but subsequently Sigma was able to renegotiate its debts.

Since then, the company faced desertions with its chief executive Elmo de Alwis quitting in April, chief financial officer Mark Smith quitting this month, and chairman John Stocker and non-executive director Doug Curlew announced last week that they were also stepping down.