PARIS, April 26: Sanofi-Synthelabo of France announced on Monday the forthcoming birth of the world's third-largest pharmaceuticals group with a better bid for its French-German rival Aventis, in line with French wishes but to the dismay of German unions.

French Prime Minister Jean-Pierre Raffarin said France had made "a strategic decision" in favour of the health sector, as it had decades ago in the aeronautical industry and nuclear energy.

Anticipating charges that Sanofi increased its offer by 14 per cent to 54.5 billion euros ($64.31bn) under government pressure, Raffarin said "France is not interventionist for its own sake, but wants to take part in a European dynamic".

In Brussels, the European Commission regulators gave a green light to the deal after having received assurance from Sanofi that measures would be taken to protect competition by selling off products where that could be an issue.

Until Friday, when the French government stepped up pressure on Sanofi and Aventis to merge, the latter had been leaning in favour of a merger with Swiss giant Novartis.

In Berlin, the government urged Sanofi to safeguard jobs and research activities at Frankfurt, where most of the 9,000 Germans employed by Aventis work. Spokesman Bela Anda said the government would watch the takeover very closely but remain neutral in the process.

But union leaders in Frankfurt expressed concern at what they said was a threat to German jobs and at the government's failure to act to prevent the take over. -AFP