Updated with more information.

LEXINGTON, Mass. ( TheStreet) -- Hedge fund MSMB Capital made an unsolicited, $18-a-share offer for Amag Pharmaceuticals ( AMAG) as an alternative to Amag's previously announced plan to merge with Allos Therapeutics ( ALTH).

The MSMB Capital offer represents a 25% premium to Amag's Aug. 2 closing share price of $14.39. Amag shares were up 11% to $16 in Wednesday pre-marketing trading.

"MSMB is a long-term investor in Amag and believes that the management's current strategy does not protect the interests of Amag's stockholders or ensure Amag's long-term viability. I believe that our offer is superior and more beneficial to Amag's stockholders than the proposed no-premium merger between Amag and Allos Therapeutics," said MSMB chief investment officer Martin Shkreli in a letter sent to Amag management.

Amag, in a statement, acknowledged receipt of the takeover proposal and said it would evaluate the offer.

On July 20, Amag announced plans to merge with Allos in an all-stock deal that valued Allos at $2.44 a share, or $260 million. Yet questions about the rationale behind the proposed deal left many investors and Amag shareholders puzzled, even angry.

Amag shares have lost 25% of their value since the July 20 merger proposal with Allos was made public. Even Allos shares have fallen 8%, suggesting the deal lacks shareholder support and stands a good chance of never being consummated.

Amag has struggled to market its iron replacement therapy Feraheme since approval and launch in July 2009. Likewise, sales of Allos' lymphoma drug Folotyn have been a major disappointment since FDA approved the drug in September 2009.

MSMB Capital, led by fund manager Shkreli, has ramped up shareholder activism in recent months. Shkreli has been public about shorting Neoprobe ( NEOP) and even took the extraordinary step of filing a citizen's petition with the U.S. Food and Drug Administration seeking to stop the agency from reviewing Neoprobe's lymph-node mapping agent.

In June, MSMB Capital made an unsolicited takeover offer for SeraCare Life Sciences ( SRLS). Following that proposal, Seracare's CEO resigned and the company announced it was putting itself up for sale.

One Amag shareholder, not affiliated with MSMB Capital and with no direct knowledge of the firm's offer, said he'd be willing to sell his Amag stake for $20 a share.

"They Amag management won't sell the company for $18, nor will long term shareholders -- the stock was recently $19 on its own," says the AMAG shareholder, who asked to remain anonymous because his fund doesn't permit him to speak to the media. " AMAG CEO Brian Periera doesn't get the big payout at these prices. In the $20s, they might be able to go hostile, direct to shareholders. What it does do is put a floor under the stock."

Another hedge fund manager, also unaffiliated with MSMB Capital, questions the legitimacy of the Amag offer.

"I don't know that MSMB has the financial resources to buy Amag, and if that's the case, this just feels like stock manipulation to me," says the fund manager, who also requested anonymity.

In its letter to Amag, MSMB Capital says a higher-priced offer for the company is possible contingent on due diligence. MSMB seeks a response from Amag by Aug. 15.

--Written by Adam Feuerstein in Boston.

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Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

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