Sigma Pharmaceuticals is reportedly getting a new suitor. The Australian drugmaker has caught the eye of U.S.-based Watson Pharmaceuticals, which is working to expand its presence overseas. Watson kicked tires at Sigma's generics division, which is valued at A$600 million, The Age reports.
Of course, if Watson decides to make a play for Sigma's generics business, it will have to compete with South Africa's Aspen PharmaCare, which has made a preliminary offer for the entire company at 55 cents per share, or A$648 million. Aspen has been checking out Sigma's books since May (and it's already downgraded its offer from an original 60 cents per share).
As you know, Sigma is attracting so much buyer interest because its stock is heavily discounted after a spate of much-publicized financial problems. The company has cut its forecasts, written down assets--including generic assets--and posted a full-year loss of A$389 million. Investors weren't charmed by those moves, and Sigma stock has dropped by 60 percent. Does that make the price right? We'll have to wait and see.