Sigma Pharmaceuticals Ltd. is in talks with shareholders who are intending to buy nearly 60% shares worth $707 million, in the Company. Following the announcement, the Company's shares surged trading at 51.5 cents, against the 0.25%drop in the benchmark index.

"The Sigma Board is considering the proposal and recommends that shareholders take no action at this stage. Sigma will make a further announcement in due course", quoted the Company.

The deal depicts a 71% premium in Sigma's latest traded price of 35 cents.

Sigma is the pioneering drug producer in Australia, yet, it has been facing severe Government regulations. The most highlighted among them is to reduce the price of the drugs.

A unanimous fund manager from Sigma said that the feasibility of the activities has not been ensured, so far.

"I think a lot of people would be very glad to see 60 cents considering where it's been trading. Whether it is enough to do the deal will be interesting", he added.

The takeover proposal will require the approval of senior Executive Chairman John Stocker and non-executive Director Doug Curlewis have already announced their decision of stepping down from the board.

Sigma's Chief Executive, Elmo De Alwis resigned due to the heavy criticism coming in from the $390 million annual loss which the Company faced.