Three-way Ratiopharm auction comes to head: sources

Pfizer will submit its bid on Wednesday, a person briefed on the matter said.

Rival bidder Actavis of Iceland is about to follow suit with a bid that would value the target at more than 3 billion euros ($4.10 billion) including debt, two people familiar with Actavis' plans said.

This would make the deal the biggest generics takeover since Teva's $7.5 billion purchase of U.S. rival Barr, and would give the winner a large slice of the world's second-biggest generics market.

Sources have said that Deutsche Bank , Actavis' main lender, is backing the move, targeting 300 million euros in annual synergies at the combined company and improving its chances to recoup more than 4 billion euros of debt to Actavis.

But Teva and Pfizer are regarded as determined contenders, eyeing immediate entry into Germany.

Israel's Teva , the world's largest generics company, would submit its make-or-break offer on Thursday at the latest, a person familiar with the company's plans said.

Ratiopharm's three suitors -- whittled down from about a dozen in November -- had been requested to make final bids by Thursday, several sources had previously said.

A spokeswoman for the Merckle family -- which is selling Ratiopharm to cut debt -- declined to comment. Officials at Pfizer were not immediately available for comment.

Actavis and Teva declined to comment.

Ludwig Merckle put Ratiopharm on the auction block as part of concessions made to creditors by his father Adolf Merckle, who committed suicide in January 2009 after ceding control of his business empire to lenders during the financial crisis.

Pfizer pledged this month to invest in growth as it sought to win Ratiopharm, a week after Teva outlined its plans, people familiar with the situation had said.

Indebted Icelandic generic drugs maker Actavis, in turn, is said to have raised the prospect of taking the enlarged company public should it win the auction.

Pfizer, the world's largest pharmaceuticals maker, is branching out into generics and has cut its research budget following setbacks in drug development. In addition, its best-selling drug Lipitor will soon lose patent exclusivity.

For Teva, Ratiopharm would be a fast track to the No. 1 position in the German generics market, where the Israeli generics giant is now a mere No. 4.

Ratiopharm is vying with Stada for second place among Germany's largest generic-drug makers, trailing the Hexal generics business of Swiss drug major Novartis .

(Reporting by Frank Siebelt and Ludwig Burger in Cologne, Philipp Halstrick in Frankfurt, Tova Cohen in Tel Aviv, Lewis Krauskopf in New York; Editing by Louise Heavens)