Bayer Seeks to Buy Schering AG for $19.73 Billion; Friendly Offer May Thwart Hostile Bid by Merck KGaA; Possible New 'Heavyweight'

Bayer-Schering Pharmaceuticals' revenue would exceed that of Schering-Plough Corp. of the U.S., which is unrelated to the German Schering. Bayer also has a large over-the-counter drug business and, including Schering's prescription drug operations, Bayer would become one of the world'...

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Bibliographic Details
Published inThe Wall Street journal. Eastern edition
Main Author Jeanne Whalen and Jason Singer in London and Mike Esterl in Frankfurt
Format Newspaper Article
LanguageEnglish
Published New York, N.Y Dow Jones & Company Inc 24.03.2006
EditionEastern edition
Subjects
Acquisitions & mergers
Alliances
Bids
Competition
Hostile takeovers
Pharmaceutical industry
Prescription drugs
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Summary:Bayer-Schering Pharmaceuticals' revenue would exceed that of Schering-Plough Corp. of the U.S., which is unrelated to the German Schering. Bayer also has a large over-the-counter drug business and, including Schering's prescription drug operations, Bayer would become one of the world's biggest drug makers. Bayer's offer of 86 euros a share, a 12% premium to Merck's, combined with "several other important commitments, is a good offer," Hubertus Erlen, chairman of Schering's executive board, said. In Frankfurt yesterday, Schering's shares closed at 84.97 euros, after rising 2.4% on speculation about a Bayer bid. Bayer's shares rose almost 3% to 34.75 euros. Bayer first approached Schering shortly after Merck made its March 13 offer, Klaus Kuhn, Bayer's chief financial officer, said in a telephone interview. Schering management would take a big role in running the combined pharmaceuticals division, giving them more clout -- and more jobs -- than would have been the case if Merck had acquired Schering, people familiar with the matter said. Still, if the deal goes through, Mr. Kuhn said he expects job cuts of around 6,000 people, or 10% of the combined firm's work force.
ISSN:0099-9660