Bayer’s Animal-Health Unit Sale Draws Interest From Big Buyout Firms
(Bloomberg) -- Bayer AG is moving ahead with plans to sell its animal-health business as large private equity firms such as KKR & Co. and CVC Capital Partners explore bids, according to people familiar with the matter.
The unit may also draw interest from buyout firms including Advent International, Blackstone Group LP, EQT Partners and Permira as well as industry rivals, the people said, asking not to be identified because considerations are private. The business could fetch as much as 8 billion euros ($9 billion), though the sale won’t start until the second quarter and valuations may change, they said.
The German conglomerate is working with an accounting firm and advisers to prepare separate financial data ahead of the potential sale, the people said. Potential bidders are discussing financing and hiring advisers, and some may look to team up, they said. Spinning off the business into a publicly traded company is also an option if bids come in too low, they said.
Bayer may wait to bring the vet unit to market until another large European carve-out, Nestle SA’s skin-health business, reaches fruition, the people said. The two units are a similar size, with Nestle’s valued at $8 billion to $10 billion and are attracting similar buyout firm names, people familiar with the matter said earlier this week.
The two disposals, if completed, could each rank among the largest deals in Europe this year, according to data compiled by Bloomberg.
A representative for Bayer declined to comment. The company has said it will give an update on its plans for the division as part of its financial results next month.
Representatives for KKR, EQT, Blackstone, Permira, CVC and Advent declined to comment.
Bayer has been under pressure to restructure its business, pledging last year to cut 12,000 jobs and exit operations, amid investor doubts about the $63 billion takeover of Monsanto Co. Bayer’s animal-health unit sells vet products for both pets and livestock, and its best-selling product line is the Advantage flea, tick and worm treatments for small animals.
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