Leverkusen, Germany and
Strasbourg, France
October 2, 2001
Bayer will greatly expand its crop protection business with
the acquisition of Aventis CropScience (ACS). The purchase
agreement has now been signed, marking the successful completion
of negotiations with current owners Aventis (76 percent) and
Schering (24 percent). The acquisition price of EUR 7.25
billion, including the assumption of debt, makes this the
largest acquisition in Bayer's history. The crop science
activities will be organized as a separate legal entity named
"Bayer CropScience" in keeping with its new, broader strategic
alignment.
"Acquiring Aventis CropScience will make us a world leader in
crop science and substantially boost Bayer's earning power,"
commented Dr. Manfred Schneider, Chairman of the Board of
Management of Bayer AG. "This acquisition again evidences our
strategy of investing for the long
term in core businesses and growth markets. For this activity,
Bayer intends to form an independent unit within the Group. We
are convinced that this is the best way to integrate the two
businesses and that this will best meet market demands and
competitive challenges." Schneider is expecting a synergy
potential of around EUR 500 million a year. One-time
restructuring charges are expected to reach the same amount.
The new company will be headed by Dr. Jochen Wulff, currently
General Manager of Bayer's Crop Protection Business Group.
Bertrand Meheut, Chairman and CEO of Aventis CropScience, will
partner with Dr. Wulff in leading the integration process.
For Dr. Wulff, the acquisition and the integration of Aventis
CropScience is a milestone in Bayer's history: "We are combining
two very successful leaders of our industry with complementary
strengths and ideal fit. And we are creating a new enterprise
with all the essentials for sustainable
growth and leadership in crop science."
The combined sales are expected to total between EUR 6.5 and 7
billion in 2001, putting Bayer close behind the market leader.
The business will cover all agrochemical activities as well as
biotechnology and seeds. "We will unite the existing strengths
of the two companies to achieve an
outstanding product offering to our customers on a global level.
The return on sales is planned to reach 20 percent by 2005,"
Wulff continued. Preparations for the integration have been
started.
Bayer CropScience will be headquartered in Monheim, Germany, and
the two principal ACS sites at Lyons, France, and Frankfurt,
Germany, will continue to play significant roles in the new
company.
The StarLink technology and all potential related liabilities
will be excluded from the transaction and remain only with
Aventis, so Bayer will not be liable for any potential claims.
Duly observing the rights of the employee representatives and
subject to the approval of the relevant authorities, closing –
the legal transfer of ownership – is expected for the first
quarter of 2002. Bayer plans to finance the purchase through new
borrowings without increasing equity capital.
Bayer is an international, research-based group with major
businesses in health care, agriculture, polymers and specialty
chemicals. With some 122,000 employees worldwide at the end of
2000, the Group recorded net income for the year of EUR 1.8
billion on sales of EUR 31 billion. Capital
expenditures in 2000 amounted to EUR 2.6 billion, R&D expenses
to EUR 2.4 billion.
Company news release
N3847
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