UPDATE 1-Par investor raises stake, pushes for sale of co

Mon May 7, 2012 9:46am EDT

May 7 (Reuters) - Activist investor Ralph Whitworth's Relational Investors LLC raised its stake in generic drug firm Par Pharmaceutical Cos Inc, and said the company should focus its strategies on a potential takeover of Par.

While Par's management was taking steps to improve the company's valuation, the stock will continue to trade at a substantial discount to the price that can be offered in a sale to a larger generic company, Relational said.

"Specifically, (Relational is) confident that substantial cost savings could be achieved in a transaction with a strategic buyer," the investor said in a regulatory filing.

Last year Relational had said Par should consider strategic alternatives.

Woodcliff Lake, New Jersey-based Par's shares were trading nearly flat at $41.69 in morning trade on the New York Stock Exchange.