Pharmacy group Sigma Healthcare has made a competing offer for Australian Pharmaceutical Industries, looking to buy up the business before Wesfarmers can enter the market.

The pair aren’t strangers to the idea of merging, having floated the idea in 2018 before reopening the channel of communication earlier this year, according to reports in AFR.

Sigma’s offer implies a value of $1.57 per API share, though would result in API shareholders receiving 35c and 2.05 Sigma shares for each share in API they hold. Or, under the non-binding offer, shareholders can choose to cash out.

Wesfarmers’ offer values API at $1.55 per share, and would signal the first time the group has entered the healthcare space – creating more robust competition for Sigma.

And, for the time being, API isn’t looking to value one offer over the other, instead wanting to allow the two to progress and see which will be better for them and their shareholders in the long run.

“The board believes it is in the interest of API’s shareholders to progress the [Sigma] proposal and allow Sigma to undertake confirmatory due diligence… in parallel with [Wesfarmers],” API said to its shareholders.

“There is no certainty that the engagement between API and Sigma will result in a change of control transaction or an offer.”

Sigma owns and operates Amcal+, Discount Drug Stores, Guardian Pharmacies, PharmaSave, and Wholelife Pharmacy and Healthfoods.