Lanxess spin-off cleared by Bayer shareholders
chemical unit Lanxess, with voters holding 99.66 per cent of the
company's capital stock supporting the split.
Lanxess, which is currently operating as a Bayer subgroup, comprises most of Bayer's chemicals activities and about one third of its polymers business. Bayer will thereafter concentrate on the primarily innovation- and technology-driven core businesses of health care, nutrition and high-tech materials.
Bayer management board chairman Werner Wenning expressed his satisfaction with the clear result of the vote, saying: "We were able to convince our stockholders that this strategic step can create value for the company, and thus for its stockholders as well. Bayer and Lanxess have everything they need for success in the future."
Lanxess can now be placed on the stockmarket as an independent company by way of a spin-off. For every 10 shares held in Bayer, each stockholder will receive one Lanxess share in addition. It is intended to list Lanxess shares on the stock market in early 2005.
Bayer and Lanxess will continue to trade with each other despite their separation, with supply and service agreements running for between one and seven years. Some of these agreements include exclusive supply relationships, especially for strategically important products.
On the basis of the agreements, the Lanxess is expected to supply goods and services to the value of approximately €700 million to Bayer in 2005, wuth €500 million coming the other way. Furthermore, Lanxess is expected to purchase approximately €500 million worth of site-specific services from Bayer Industry Services (BIS) in 2005. While BBS and BTS will remain wholly owned subsidiaries of Bayer AG, Lanxess will own a 40 per cent interest in BIS.
Bayer and Lanxess will also jointly operate their chemical park sites in the future. Lanxess will use large sections of Bayer's main site in Leverkusen, where approximately 5,200 people work for the company.
Lanxess also has approximately 2,000 employees in Krefeld-Uerdingen and about 1,200 in Dormagen. The company has roughly 20,000 employees in all, about half of whom are based in Germany. Following the spin-off, the Bayer will have about 93,500 employees worldwide, including 37,800 in Germany.
Meanwhile, Dr Rolf Stomberg has been appointed acting chairman of the supervisory board of Lanxess until the company holds its first stockholders' meeting, and has been nominated for the permanent position.
Wenning said that Lanxess will be better able to adapt to competitive conditions in the future than it could as part of Bayer. "With its human and financial resources and its organisational structures, Lanxess has everything it needs to successfully manage its businesses as an independent company," he said.
