German drug maker Bayer on Thursday announced plans to sell or divest multiple businesses, as well as a large workforce reduction. The moves are a response to pressure on the company’s stock price, which has fallen 35% this year.
The company said it was reviewing strategic options with a view toward selling its sun-care and footcare business lines and exiting its animal health division. It also said it was in discussions to sell its 60% stake in chemical-production-site-services provider Currenta.
Additionally, Bayer announced impairments of $3.8 billion (3.3 billion euro).
Bayer completed its $63 billion acquisition of Monsanto earlier this year, resulting in legal exposure to more than 9,000 lawsuits over an alleged cancer-causing effect of Monsanto weed killer Roundup. To gain regulatory approval for the Monsanto deal, Bayer had agreed to sell assets including its seed business and some herbicide brands.
“We have made very good progress with Bayer’s strategic development in recent years,” chairman Werner Baumann said in a statement. “As we now proceed with these measures, we are laying the foundation to sustainably enhance Bayer’s performance and profitability. With these measures, we are positioning Bayer optimally for the future as a life science company.”
The company said it would cut around 12,000 jobs by the end of 2021, a significant number of them in Germany. It also plans to cut more than 4,000 jobs in its crop sciences division.
Analysts have said the animal health division, with sales of nearly $1.8 billion in 2017, could sell for around $8 billion. The company said proceeds from the sale would go to support its core pharmaceuticals, consumer health, and crop science businesses.
The company said its 60% stake in Currenta was no longer justified following its carve-out of Covestro last year.
Bayer acquired sunscreen brand Coppertone and foot-care brand Dr. Scholl’s from Merck & Co in 2014 for $14 billion. Selling those businesses would allow the company to focus on growth in its core consumer health categories, it said.