Top shareholder in S.Africa's Adcock thinks Bidvest offer too low -source

JOHANNESBURG Thu Dec 5, 2013 7:45am EST

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JOHANNESBURG Dec 5 (Reuters) - South Africa's state pension fund will not sell its stake in Adcock Ingram to bidder Bidvest at 70 rand a share because it believes the offer undervalues the company, a source familiar with the fund's thinking said on Thursday.

The state-owned Public Investment Corporation, Adcock's top shareholder, would "probably" be willing to accept a rival offer from Chile's CFR Pharmaceuticals if it were all in cash, said the person, who declined to be identified because the information is not yet public.

Santiago-based CFR has offered $1.2 billion in cash and shares to buy Adcock, South Africa's second-largest drugmaker. The offer values Adcock shares at around 73.51 rand. Bidvest challenged that offer this week with its own 4 billion rand ($383 million) for a third of Adcock. ($1 = 10.4325 South African rand) (Reporting by Tiisetso Motsoeneng; editing by David Dolan)