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Bayer To Quit Plastics

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18. September 2014

Bayer AG has announced that it plans to focus entirely on its Life Science businesses—HealthCare and CropScience—and intends to float MaterialScience on the stock market by 2016 at latest as a separate company. The BMS business, with North American headquarters in Pittsburgh, is comprised of polyurethane, TPUs, PC, inorganic chemicals and coatings & adhesives.

 

Bayer CEO Dr. Marijn Dekkers says the company intends to create two top global corporations: Bayer as a world-class innovation company in the Life Science businesses, and MaterialScience as a leading player in polymers. Subsequent to the intended spin-off, MaterialScience will be Europe’s fourth largest chemical company; it had global sales in 2013 of more than $14.2 billion (pro forma figure). The new company will have a new name and a separate identity and be headquartered in Leverkusen, Germany. Employment levels are expected to remain stable over the next few years. It is planned that the new company will have a global workforce of about 16,800, including 6500 in Germany.

 

Dekkers noted that the company firmly believes that MaterialScience will use its separate status to deploy its existing strength even more rapidly, effectively and flexibly in the global competitive arena. A strategy and corporate culture aligned to technological and cost leadership, coupled with the ability to make its own investment and portfolio decisions, would give MaterialScience the best development prospects in a highly competitive market. That, according to Dekkers, includes direct capital market access so that that it would not have to compete with the Life Science businesses for investment funding in the future.

 

It is possible that a similar action might be taken by DuPont, according to a Sept. 17 Forbes article. Activist investor Nelson Peltz sent a note to DuPont’s board this past Tuesday, which said Peltz’s hedge fund, Trian Partners, is urging the company to break itself up. According to Forbes, Trian is one of DuPont’s largest shareholders and discussions have been underway for the past year as Trian feels that it can “no longer be silent as DuPont continues to struggle to execute” what Trian believes is a flawed business plan.

 

Want to find or compare materials data for different resins, grades, or suppliers? Check out Plastic Technology’s Plaspec Global materials database.

 

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