Bayer said to consider sale of diabetes unit for up to 2b
Pharmaceutical major is working with Credit Suisse on the potential sale, three of the people said
Bayer AG is exploring the sale of its diabetes device business as the German company focuses on fastergrowing medicines, according to people with knowledge of the matter.
Bayer, based in Leverkusen, Germany, is working with Credit Suisse Group AG on the potential sale, three of the people said, asking not to be identified because the process is private. Private- equity firms such as Cinven Ltd, EQT Partners AB, KKR & Co. and Triton Advisers Ltd may consider bidding for the unit, which could fetch between € 1 billion ( Dh4.56 billion) and € 2 billion, the people said.
Bayer Chief Executive Officer Marijn Dekkers is selling peripheral units as he focuses on more lucrative life- sciences businesses. In addition to the diabetes sale, the company plans to list its plastics unit on the stock market. It agreed in May to buy Merck & Co.’ s overthe- counter drug business for $ 14.2 billion, and Dekkers also has expressed interest in acqui- sitions in veterinary medicines.
“It probably would be better to concentrate on their growth business, which is the pharma pipeline and the animal- health business,” said Ulle Woerner, an analyst at Landesbank Baden- Wuerttemberg in Stuttgart, Germany. “It’s going to be hard to sell it at a good price.”
Bayer’s shares rose as much as 1.4 per cent to € 119.10 in German trading, giving the company a market value of about € 98 billion. Zoetis gained 1.6 per cent to $ 44.58 in New York yesterday, a new closing high.
The German firm is interested in Zoetis Inc, the $ 22 billion animal- health company separated from Pfizer Inc. Bayer sees no rush to bid for Zoetis because no auction has started and it aims to raise money from the plastics unit and diabetes sale first, the person said.
Zoetis earlier this month adopted a poison- pill shareholder plan to help block a hostile takeover after activist investor Bill Ackman took an 8.5 per cent stake. Such investments could lead to pressure on Zoetis for a sale.