Bayer AG Chief Executive Officer Werner Baumann said he’d consider a “financially reasonable” settlement of litigation over the weedkiller Roundup as the caseload swells and the company’s shares slump anew.
The number of lawsuits from people in the U.S. who say the herbicide caused them to develop cancer rose by about 5,000 to 18,400, Bayer said in a statement. The company also revealed more troubles at its crop-science division on Tuesday after bad weather curbed demand from farmers.
Quarterly sales and earnings missed estimates and the German company questioned its ability to meet its full-year forecast. The shares fell 3.4 percent in Frankfurt.
Baumann has staked his credibility on last year’s $63 billion takeover of Monsanto Co., claiming the company is better off balancing its portfolio between agriculture and health care. But the surge in U.S. lawsuits alleging that Roundup -- which Bayer inherited from Monsanto -- causes cancer suggest settling the claims will become more expensive than previously thought, heaping more pressure on Baumann three months after he received an unprecedented rebuke from shareholders.
“The jump in lawsuits is worrying,” said Mustaq Rahaman, a credit analyst at Bloomberg Intelligence. “This set of results will do little to stem calls for more dramatic action including a split.”
Baumann said on a conference call that he is open to a settlement as long as it resolves all Roundup litigation. He repeated that the herbicide is safe, that the cases have no merit and that the company is “constructively engaging” with court-appointed mediator Ken Feinberg........MORE