Bayer to shed animal health division, others after Monsanto deal

 

Ludwig Burger, Reuters

via GFM Network News/Glacier FarmMedia Feed/Canadian Cattlemen - November 29, 2018

 

Frankfurt | Reuters — Bayer, the German drugmaker that bought U.S. seed company Monsanto, announced on Thursday the sale of its animal health business and a number of others, around 12,000 job cuts and 3.3 billion euros (C$4.98 billion) in impairments.

 

CEO Werner Baumann is under pressure to boost Bayer’s share price after a drop of more than 35 per cent so far this year, dragged down by concern over more than 9,000 lawsuits it faces over an alleged cancer-causing effect of Monsanto’s Roundup herbicide.

 

The group said it was looking at options — that could include a sale — for the Coppertone sunscreen and Dr. Scholl’s foot care products from the consumer healthcare division it bought from Merck + Co. in 2014 for US$14 billion.

 

It will also divest its animal health division, the number five player in the industry, which analysts have said could fetch six billion to seven billion euros (C$9 billion-$10.6 billion).

 

The unit, the largest maker of flea and tick control products for cats and dogs and a supplier of livestock veterinary drugs, had sales of 1.57 billion euros in 2017, accounting for about 4.5 per cent of group revenues.

 

There has already been consolidation in animal health, with Pfizer and Eli Lilly, successfully floating their veterinary medicine units on the stock market as independent entities.

 

Bayer ranks fifth in veterinary medicine, behind Zoetis, the former Pfizer unit, Elanco, unlisted Boehringer Ingelheim, which acquired animal health assets from Sanofi, and drugmaker Merck.

 

Bayer will also seek a buyer for its 60 per cent stake in German chemical production site services provider Currenta.

 

All three possible transactions were previously flagged by Reuters.

 

Markus Mayer, an analyst at Baader Helvea, said Coppertone and Dr. Scholl’s could fetch one billion euros and the Currenta stake could fetch 1.5 billion euros.

 

Reckitt Benckiser and Procter + Gamble Co. will likely be among the suitors for the consumer brands, said investment bankers, who asked not to be named.

 

Job cuts ...

 

more

https://www.canadiancattlemen.ca/daily/bayer-to-shed-animal-health-division-others-after-monsanto-deal/