Bayer’s Cove­stro scales back IPO in wake of VW scan­dal

The China Post - - BUSINESS INDEX & -

Cove­stro, the poly­mers busi­ness of Ger­man phar­ma­ceu­ti­cals gi­ant Bayer, on Thurs­day de­layed and scaled down its planned stock mar­ket flota­tion, orig­i­nally slated for this week, due to the volatil­ity trig­gered by the mas­sive Volk­swa­gen pol­lu­tion- cheat­ing scam.

“In light of the cur­rent de­te­ri­o­ra­tion and volatil­ity in the cap­i­tal mar­ket en­vi­ron­ment,” Bayer and Cove­stro had scaled back the amount of cash they had hoped to raise from the ini­tial public of­fer­ing (IPO), they said in a state­ment.

And the shares would be listed on the Frank­furt stock ex­change from Oct. 6, in­stead of Oct. 2 as orig­i­nally planned.

“Since the start of the book­build­ing phase on Sept. 21, 2015, the cap­i­tal mar­ket sit­u­a­tion has de­te­ri­o­rated sig­nif­i­cantly,” state­ment said.

“Ex­ter­nal fac­tors such as un­cer­tainty sur­round­ing fu­ture eco­nomic growth in China or the (United States) Fed­eral Re­serve’s in­ter­est rate pol­icy have con­trib­uted to in­creased mar­ket volatil­ity,” it ex­plained.

“In ad­di­tion, the stock mar­ket has been im­pacted by the neg­a­tive head­lines from the au­tomo-

the tive sec­tor,” the state­ment added, re­fer­ring to the pol­lu­tion-cheat­ing scam that has en­gulfed Ger­man auto gi­ant Volk­swa­gen and wiped bil­lions of eu­ros off its mar­ket cap­i­tal­iza­tion.

Cove­stro, which de­scribes it­self as one of the world’s lead­ing poly­mer man­u­fac­tur­ers, in­tends to is­sue be­tween 61.2 mil­lion and 69.8 mil­lion new shares by way of a cap­i­tal in­crease.

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