The decision of Bayer's supervisory board will be released soon on whether Bayer will be pushing to raise funds for its plastics unit. Details on whether the company will sell its unit in an initial public offering or simply distribute the shares to its stockholders are not yet made public.
This announcement will end market speculation that the company will get rid of that unit since that line of business has lower than expected return than its cost of capital. The company has wanted to let go of this unit and focus on its life-sciences businesses which is more lucrative.
Bayer Medical Science makes polymers found in cars, houses and businesses. The unit earned 11.2 billion euros in sales last year which is down 2.2 percent from 2012. Last April, Evonik Industries AG showed potential interest on the business and this current announcement may spark renewed interest from potential investors. Bayer may be left with 10 billion euros of proceeds from the divestiture, providing them funds to invest in health care.
Bayer AG is a German-based chemical and pharmaceutical company founded in 1863. The company's main line of business includes human and veterinary pharmaceuticals, consumer health care products, biotechnology products, agricultural chemicals and high value polymers. The company has been in operations for over 150 years.
Over the years, Bayer has discovered numerous medicines, most popular of which are Aspirin and Heroin. Bayer has also acquired several companies such as Miles Laboratories whose product line includes Alka-Seltzer, flintstones vitamins and One-A-Day vitamins. Recently, Bayer agreed to purchase the consumer health business of Merck for $14.2 billion. MErck's line includes Claritin, Coppertone and Dr. Scholl's. This acquisition will make Bayer the number two in the market for non-prescription drugs.
Bayer AG, a holding company for all its core businesses, is currently listed in the London Stock Exchange, Frankfurt Stock Exchange and previously on the New York Stock Exchange.
