King Pharmaceuticals Inc’s $1.4 billion offer to buy Alpharma Inc follows a wave of unsolicited bids in the otherwise weak merger market.

So far this year, there have been 50 unsolicited bids, totalling $137.3 billion worldwide, up from 19 deals totaling $30.2 billion for the same period a year ago, according to Thomson Reuters data.

The amount of unsolicited or hostile takeover bids has increased as weak stock prices have enticed large corporations that have the luxury of cash on their books or the ability to raise funding despite tight credit markets.

Other unsolicited offers this year included InBev NV’s successful battle for Budweiser brewer Anheuser-Busch Cos Inc, and Microsoft Corp’s abandoned effort to buy Yahoo Inc.

King warned it would make a hostile bid if Alpharma refused to accept its bid. King wants to expand its pain drug business through the acquisition of Alpharma, which makes the pain drug Kadian and pain patch Flector, as well as plus products to treat animals.

So far this year, there have been 9 hostile bids valued at $12 billion, compared with 6 bids valued at $102.2 billion at this point last year, according to Thomson Reuters.

It looks like King may have a battle ahead of itself as Alpharma said the offer was not in the best interest of its shareholders. The proposal was essentitally identical to two previous offers by King that Alpharma already rebuffed, Alpharma said.

Alpharma, however, said it would be open to discussions for a deal at a higher price. Analysts said Alpharma’s hint that it would consider more money puts the company in play for other suitors to emerge and potentially creates a costly bidding war for King.

Media companies aren’t the only ones who needed Google’s help. The Wall Street Journal is reporting Verizon and Google are nearing a wide-ranging agreement that will see Google as the default search provider on Verizon handsets.

It’s not the first time the two have reportedly come close to landing a partnership. They were in discussions last year as well. 

At issue, according to the report, is Google’s desire to save information from user searches in order to enhance the relevancy of its ads. Verizon, like other carriers, have been unwilling to part with such valuable consumer data. Another hang-up is the revenue split from the ads.

Regardless, Google’s Android phones are expected to hit the market shortly, making deals like this just one part of the Internet search leader’s massive mobile ambitions.

Keep an eye on:

• Courts warn media companies on take-down notices (Wired)
• Advertising slowdown continues, says WPP (Reuters)
• Apple’s iPhone 3G launches in India with no mass hysteria and a price tag of $700 (Reuters)

(Photo: Reuters)

Just yesterday, the sound of doors closing could almost be heard echoing across the pacific as Lehman Brothers reportedly hit the Asian wealth circuit looking for help filling its expected $4 billion in third-quarter writedowns. Now state-run Korea Development Bank says it might be interested in buying the bank, lighting an 8 percent fire cracker under Lehman’s stock in premarket trade. “We are studying a number of options and are open to all possibilities, which could include (buying) Lehman,” a KDB spokesman said. KDB said it was open to mergers or acquisitions of both domestic and foreign companies to beef up its weak areas as the government was aiming to privatize it by 2012. Previous reports said KDB and CITIC Securities, China’s biggest brokerage, balked at the high price Lehman was asking.

Since its long-standing dispute with CME Group’s Chicago Board of Trade over trading rights is just about settled, the Chicago Board Options Exchange may soon become a takeover target. While the CBOE is expected to pursue an initial public offering, with a filing possible as soon as next month, many exchange industry experts see that as only an interim step. It will be like sticking a “for sale” sign up, they argue. Despite being the top U.S. equities options market, with a stranglehold on index options, the CBOE may have to consider a bigger partner. It is one of the few remaining stand-alone exchanges, which leaves it vulnerable to a squeezing of its margins by growing competition, particularly exchanges that can offer investors stocks and options under the same roof.

Mining giant BHP Billiton’s $128 billion bid for rival Rio Tinto could raise competition issues in iron ore. With mines across Australia’s ore-rich Pilbara region, Rio Tinto and BHP are the world’s second- and third-largest iron ore producers, respectively, behind Brazil’s Vale, and analysts reckon a combined group would control about 35 percent of the world’s seaborne traded iron ore. In a nine-page “statement of issues” ahead of its Oct.1 ruling, the Australian Competition and Consumer Commission (ACCC), which can order companies to sell assets if it thinks they have too big a hold in one sector, highlighted the likely impact of a deal on the iron ore trade and, in particular, on Australian steelmakers, but saw no major competition issues in copper, gold, uranium, bauxite or alumina. “I don’t think that’s a surprise to the two companies, particularly BHP … that iron ore would be the one area the regulators would be looking at very closely,” said Ken West, a partner at Perennial Growth Management. “But the Pilbara is the one they don’t want to be tampered with. If the regulators don’t show flexibility, then the Pilbara could become a deal breaker,” West said.

Other deals of the day

* Aon Corp, the world’s largest insurance broker, has made a recommended cash offer for Benfield valuing the UK-listed broker at 844 million pounds ($1.6 billion).

* New Zealand jeweller Michael Hill International said it had agreed to acquire 17 stores from the chapter 11 bankruptcy of Whitehall Jewelers Holdings Inc. The company said it would pay $5 million for the stores in Illinois and Missouri, its first foray into the U.S. market.

* Providence Equity Partners and MBK Partners are among the private equity firms on the shortlist for a 45 percent stake in the new telecom unit of Hong Kong’s PCCW, in a deal that could fetch more than $2.5 billion.

* Mining giant BHP Billiton’s $128 billion bid for rival Rio Tinto could raise competition issues in iron ore, Australia’s antitrust regulator said.

* Vitec Group said it will buy California-based LED lighting business Litepanels for up to $64.5 million to expand its Broadcast Systems division.

* British alternative software vendor Formjet said it has decided not to go ahead with a planned 1.2 million pound acquisition of a specialist distribution company.

* Sale of Russia-focused Imperial Energy is likely to be announced next week, an Indian government source said, confirming that Oil and Natural Gas Corp is in the race to buy the firm.

* South Korea’s POSCO, the world’s No.4 steelmaker, may buy iron ore, steel mill and shipyard assets in Ukraine, as it looks to reassure investors who have questioned its potential acquisition of Daewoo Shipbuilding.

Schaeffler has finally won the battle for Continental in an $18 billion deal that would create the world’s third-largest auto supplier.

Schaeffler makes ball bearings, typically used to steer a car. Its mechanical joints can be found in everything from the London Eye ferris wheel to the U.S. space shuttle. Continental makes a variety of components from tyres to brakes.

The grand finale ends a long and bitter battle in which Schaeffler quietly amassed a 36-percent stake in Continental, while Continental attacked Schaeffler as “egotistical, autocratic and irresponsible.”

Despite all that acrimony, Continental has decided to give control of the company to the Bavarian group owned by glamorous billionaire Maria-Elisabeth Schaeffler and her son.

The move by Continental is a sign of the times. And a harbinger of things to come. Rising gas prices, falling home prices and weak credit markets have eaten into car sales all over the world. In the United States — the world’s largest auto market — July auto sales plunged to their lowest in 16 years.

As automakers try to cut costs in every way possible, they are amping up the pressure on suppliers. And as suppliers get squeezed, fewer of them will be able to stand alone. At least half of the major U.S. suppliers have gone through bankruptcy. A few are struggling to exit Chapter 11.

Already squeezed by record commodity prices, the auto supplier industry has been hit hard by the slump in vehicle sales.

Not only are suppliers faced with the need to present automakers with lower bills, but they are also suffering from unexpected production cuts. While several automakers are slashing production of pickups trucks and SUVs, the suppliers were banking on the original (higher) production numbers.

More suppliers may be forced to seek bankruptcy protection or merge to capture cost-savings, analysts predict. As automakers look to streamline every part of their business, they may want a one-stop-shop for supplies instead of dealing with multiple parts vendors, which could also put an emphasis on consolidation.