Report: Bayer agrees deal

August 31, 2001 Posted: 1458 GMT

LONDON (CNN) -- Bayer, the troubled drugs and chemicals maker, reached an agreement to buy the Crop Science unit of Aventis, the Financial Times reported.

Negotiations between Aventis (PAVE), the Franco-German drug company, and Germany's Bayer (FBAY) have been in progress since July.

Aventis began consulting its employees over the disposal agreement earlier this week, according to unidentified union sources cited by the FT and Reuters news agency.

Bayer Chief Executive Manfred Schneider said on Friday he expected to be able to announce an agreement on the purchase by the end of September.

Talks with the staff of the unit being sold are a legal requirement before the firms can formally sign a sale agreement, the FT reported.

Bayer has seen its market capitalisation fall more than a quarter since August 8, when it withdrew from sale a cholesterol-lowering drug that had been linked to reports of at least 50 deaths in the U.S. and elsewhere.

Shortly after that, it began a review of the future of its pharmaceutical business, amid speculation a larger drug company might make a bid to buy the division.

New York listing postponed

It was also forced to postpone a listing of its shares on the New York Stock Exchange, originally planned for September, until the first quarter of next year, because of the slide in its share price.

Throughout this process, the company has reiterated it still expects to complete the purchase of Aventis Crop Science, the world's third-biggest maker of agricultural chemicals.

It has also continued to commend to increasingly skeptical shareholders its long-standing policy of being active in a number of industrial activities, rather than focusing on just chemicals or drugs, in line with the strategies of  the majority of its rivals.

The FT said that the purchase could cost between 5 billion and 5.5 billion ($4.6 billion to $5 billion), and would be Bayer's biggest ever acquisition. The report said the company was likely to pay for the purchase by taking on more debt – restricting the amount it will be able to invest in its ailing pharmaceuticals arm.

Aventis Crop Science is majority owned by Aventis, with a 24 percent stake belonging to German drug maker Schering (FSCH).

	Want the full story? Search for free company info...
	Enter Company Name:-