German pharmaceuticals group Bayer today unveiled details of a bid worth €16.3 billion for Schering, challenging a hostile bid by Merck and raising the stakes in a battle for consolidation of the German drugs sector. Bayer said that if its proposal went ahead, 6,000 jobs would be shed in the new group.
Late yesterday, Bayer made a cash offer for Schering of €86 a share, which the company said was 39% higher than the actual Schering share price. It would value the Berlin-based drugs company, which is a world leader in oral contraceptives and fertility drugs, at €16.3 billion.
Bayer said Schering had announced it would accept the offer. Bayer's offer is 12% higher than that of Merck, which made an unsolicited offer for Schering last week at €77 a share.
Bayer boss Werning Wenning, presenting his move as friendly, said the company planned to sell two companies in its chemistry stable to prepare for a merger, and told reporters that Bayer planned to shed 6,000 jobs if the deal with Schering went ahead.
For Bayer, which has slipped down the world rankings since the 1980s, a tie-up with Schering would help it to regain its place among the world's pharmaceutical giants. The deal would also strengthen Bayer's position as the dominant drug company in the German market.
Wenning said that Bayer planned to dispose of HC Stark and Wolff Walsrode, which form part of its MaterialScience division.
