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BUSINESS
FTC's approval was conditional on divestment or out-licensing of a number of products marketed in the U.S., stipulations that Bayer has accepted. Some of the conditions mirrored those required by the European Union, which approved the deal in April. For example, both say Bayer must divest its global business in fipronil, an insecticide used for agricultural applications, but may market the product for nonagricultural uses except in Europe. And Bayer must divest its insecticide acetamiprid in Europe and North America. FTC also required divestiture of Bayer's wheat herbicide Everest and its cotton defoliant Folex. Generally, however, Bayer will keep its major products, such as its versatile imidacloprid insecticides, used in both agricultural and horticultural applications. In total, the conditions will cut Bayer CropScience's sales by between $585 million and $630 million. However, says Jochen Wulff, chairman of the new unit, although the company has had to reduce its sales forecast in order to meet antitrust requirements, "we are holding on to our strategic goal of achieving a 20% return on sales by 2006." Meanwhile, Bayer will sell its remaining stake of 30% in Belgian films company Agfa-Gevaert to investment bank Goldman Sachs for nearly $190 million. Bayer had sold its former subsidiary on the stock market in an initial public offering in 1999, retaining the minority stake as a financial investment. Also on the divestment front, Firmenich--a family-owned Swiss fragrances and flavors supplier--has been added to the list of bidders for Bayer's subsidiary Haarmann & Reimer. Virtually every large company in the business has been named as a potential buyer of the subsidiary, which Bayer wants to sell for at least $1.4 billion. |
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