Bayer exploring options to offload plastics unit: report
Bayer AG, Germany-based pharmaceutical to chemicals group, is reportedly mulling a plan to sell its $10 billion plastics unit so that it could save time and resources to expand its health business.
People with direct knowledge of the matter said Bayer is mulling the options for plastics unit Bayer Material Science after rival chemicals firm Evonik Industries AG expressed potential interest in the unit months back.
Speaking on the condition of anonymity, they added that a decision had yet to be taken by the German group, and that the Evonik considerations had failed to gain traction.
Fabian Wenner, an analyst with Zurich-based Kepler Cheuvreux, estimated that the sale of the plastics unit may fetch Bayer more than 7.8 billion euros (US$10.8 billion) including net debt.
Demand for Bayer's polycarbonates, a type of transparent plastic, in on the decline as lower-cost competitors like Sabic have built new sites and increased supply of the material in the global market.
Meanwhile, Bayer's mergers & acquisitions team is focusing on pursuing the company's chosen targets in the field of healthcare. Some reports recently suggested that Bayer is interested in acquiring Merck & Co.'s over-the-counter medicines business.
Bayer fell 1 percent to 95.77 euros on April 25 in Frankfurt, giving the company a market value of 79 billion euros.