Drug wholesaler's shares surge

SYDNEY - Shares of Australian Pharmaceutical Industries surged after brokers including UBS said Sigma Pharmaceuticals may increase its A$566 million ($642 million) offer for the drugs wholesaler.

Australian Pharma stock rose as much as 19 per cent above the A$2.20 a share offer made by Melbourne-based Sigma on October 6.

Sigma's offer is "on the skinny side", Robert Millner, chairman of Washington H. Soul Pattinson, which owns 21 per cent of Australian Pharma, was quoted as telling the Australian Financial Review on October 7.

"Sigma is likely to be in a position to offer a higher bid," said Andrew Goodsall, a health analyst at UBS.

Sigma is reviving a plan to become the country's biggest drug wholesaler by acquiring its Sydney-based rival.

- BLOOMBERG