Source: Dow Jones News Service, July 22, 2019
Posted on: https://www.advisen.com
Bayer AG, the German pharmaceuticals and chemicals group battling legal claims over its Roundup herbicide, said Monday it would sell its Dr. Scholl’s foot-care business to Yellow Wood Partners for $585 million.
The unit is one of a series of assets Bayer marked for disposal last fall, aiming to boost profitability and repair damaged investor confidence in the overall company.
Boston-based private-equity firm Yellow Wood said it would create a stand-alone company for Dr. Scholl’s, which reported sales of $234 million in 2018.
Shares of Bayer listed in Frankfurt were mostly flat at EUR59.73 in afternoon trading Monday.
Bayer has been under pressure for the last year as it contends with litigation from more than 13,000 U.S. plaintiffs who claim the weedkiller Roundup caused their cancer. Over the past year, Bayer has lost three jury trials in California.
Bayer’s failure to foresee the scale of the legal liability attached to Roundup when it acquired its owner Monsanto Co. last year caused a powerful backlash among large Bayer investors who passed a rare no-confidence vote in management at the company’s last general meeting.
Partly in reaction to the criticism, Bayer said in June it would seek outside legal help and form a special supervisory board committee to oversee the company’s legal approach to the lawsuits.
Bayer said in May it would sell its Coppertone sunscreen brands to German consumer-care group Beiersdorf AG for $550 million.
The sales come as Bayer aims to trim 12,000 jobs, or 10% of its workforce, to pare costs.