Actavis raised its offer for Pliva to $2.3 billion yesterday, but was promptly outbid once again by rival suitor Barr Pharmaceuticals as the battle for the Croatian generic drugmaker heats up.

Barr’s latest offer for Pliva is raised to 743 kuna-per-share and tops Actavis 723 kuna bid, both of which are said to value the Croatian firm in the region of $2.3 billion. Earlier this week, Pliva accepted a 705 kuna takeover offer from Barr, making it the ‘preferred bidder’ in the auction, on the grounds that it would create a company strong on both sides of the Atlantic.

Barr chief executive Bruce Downey said his company represented the best match for Pliva, as it has the capital in hand to complete the transaction, as well as complementary businesses with limited overlap in products and markets. He said Barr was committed to maintain investment in Pliva’s facilities and base its European headquarters in Croatia.

For its part, Actavis said it raised its offer because it had identified ‘greater potential synergies than previously anticipated’ in the merger. The company originally offered $1.6 billion for Pliva and maintains that its bid is the best on the table because it creates the third-largest generic drugmaker in the world with ‘one of the strongest product pipelines in the industry’.

It also pointed to its track record in absorbing new companies efficiently, with 20 acquisitions under its belt in the last seven years.

Meanwhile, Actavis said yesterday it had already built a 20% stake in Pliva through stock purchases and option agreements, although as the terms of Barr’s offer require a threshold of just 50% or more shares in Pliva to proceed, it would be a hard task for the Icelandic firm to use its stake as a blocking tactic.

The Icelandic company also said that its bid was not subject to antitrust review by regulators, although in its offer statement Barr disputed this, saying both offers would require clearance in the USA.

Pliva said in a statement that "until publication of the offer that Barr has committed to make or any offer that Actavis may commit or be obliged to make [it] recommends that shareholders take no action in relation to their Pliva shares."