Bayer cutting 12,000 jobs and exiting animal health business
Bayer AG plans to cut 12,000 jobs and exit its animal health business in an effort to reverse its share price slump since its $63bn takeover of Monsanto Company.
The cuts, including a significant number in Germany - where layoffs are politically sensitive - represent about 10pc of the workforce.
Bayer is under mounting pressure to prove that its new model makes sense. The Monsanto deal turned it into the world's largest agricultural chemicals and seeds maker, but investors remain unconvinced.
Bayer's market value has plunged by €30bn since August when a California jury ruled against its signature weed killer Roundup, saying it may have caused a school groundskeeper's cancer. At least 9,000 other lawsuits are pending.
"[These] decisions were not made necessary by the recent acquisition, and certainly not by glyphosate litigation in the US," said Bayer CEO Werner Baumann. "Absolutely nothing to do with it."
Of the 12,000 job cuts, half will probably come from corporate and supporting functions, while another third will be in crop science as the Monsanto integration proceeds, Bayer said.
Analysts estimate that Bayer's animal health operations are probably worth as much as €6.5bn. That unit sells vet products for both pets and livestock, and its bestselling product line is the Advantage flea treatment for small animals.
After the stock fell about 40pc over the past year, Bayer has faced growing questions about how its disparate units will remain competitive.