Bayer AG plans to cut 12,000 jobs and exit its animal health business in an effort to mollify Wall Street, which has punished the company over the tidal wave of lawsuits that came alongside the $63 billion takeover of Monsanto Co.
The German company announced a rash of moves, including exiting the sun-care and foot-care segments, that it said would boost its core pharma and agricultural businesses. The cuts, including a significant number in Germany -- where layoffs are politically sensitive -- represent about 10 percent of the workforce.
The shares were little changed as of 4 p.m. in Frankfurt trading, erasing initial gains after the announcement.
The company has lost some 30 billion euros ($34.1 billion) in market value since August, when a California jury ruled against its signature weedkiller Roundup, saying it may have caused a school groundskeeper’s cancer. At least 9,000 other lawsuits are pending.Recently:
After the stock fell about 40 percent over the past year, Bayer has faced growing questions about how its disparate units will remain competitive. Restructuring and cost cuts were widely expected ahead of an investor’s day meeting in London on Wednesday.
“They delivered what everyone was hoping for,” said Ulrich Huwald, a Hamburg-based analyst with Warburg Research GmbH, citing the planned asset sales. “It’s a good package on the face of it.”...MORE
head of Tomorrow's Q3 Report: "Agricultural Venture Capital at Bayer"
Except for the fact the company bought Monsanto with its top-selling Roundup pesticide brand, for $63 billion, despite the fact Germany itself is going to outlaw the stuff, except for the $289 million initial verdict on a cancer case,* everything is going swimmingly....