By Jason Hovet

PRAGUE (Reuters) - Zentiva (ZNTVsp.PR: Quote, Profile, Research) advised its shareholders on Friday to reject a $2.1 billion takeover offer by France's Sanofi-Aventis (SASY.PA: Quote, Profile, Research), as investors awaited a higher one in the bidding war with a Czech financial fund.

Already Zentiva's largest shareholder with a 24.9 percent stake, Sanofi-Aventis launched its 1,050 Czech crown per share bid a week ago, valuing the offer at 30 billion Czech crowns ($2.06 billion) and the entire company at 40 billion crowns.

It trumped a 950 crown per share offer from Czech financial group PPF, which Zentiva rejected last month. PPF has a 19.2 percent stake.

Zentiva's board said Sanofi's offer failed to reflect the underlying value of the company and its future prospects.

Shares in Zentiva showed little reaction to the statement, rising 0.4 percent to 1,125 crowns in light trade by 0810 GMT, outperforming Prague's PX index, which lost 0.7 percent.

"The bid is under the actual market price, so it is not a big surprise that Zentiva's management rejected the offer," said Jan Krejci, an analyst with Patria Finance in Prague.

"There is still some speculation on the market that there will be a second round of bidding."

If Sanofi's bid succeeds, it would give the world's third largest drug maker by sales a bigger foothold in the fast growing east/central European markets.