The planned job cuts will affect about one in every ten of the group's 118,200 posts. AFP-File/Patrick Stollarz |
German chemical and pharmaceutical giant Bayer said Thursday it would slash 12,000 jobs in a major restructuring following the mammoth takeover of Monsanto, enabling it to save 2.6 billion euros ($3 billion) a year from 2022.
The planned
job cuts will affect about one in every ten of the group's 118,200 posts,
"a significant number of them in Germany", said the group in a
statement.
Bayer
swallowed Monsanto in one of Germany's biggest ever corporate takeovers at a
cost of $63 billion in June.
But barely
two months later, a court ruling in the US left Bayer with multi-million-dollar
damages to pay as the judge found that its newly acquired subsidiary Monsanto
should have warned a user about cancer risks from its herbicide Roundup.
Announcing
details of the restructuring, Bayer said it planned to exit its animal health
business, in order to concentrate resources on its core businesses of
pharmaceuticals, consumer health and crop science.
It is also
looking at letting go of its Coppertone sun care brand and Dr. Scholl's foot
care product line.
Following
the tie-up with Monsanto, the group's crop science division will be among the
hardest hit by the job cuts, with 4,100 posts to go.
The company
said it expected to complete trimming its headcount by the end of 2021.
"These
changes are necessary and lay the foundation for Bayer to enhance its
performance and agility. With these measures, we aim to take full advantage of
the growth potential for our businesses," said Werner Baumann, Bayer board
chairman.
Glyphosate fears
Investors
gave a muted response to Bayer's announcement, with shares in the group closing
down 0.72 percent to 63.77 euros against a flat DAX index.
Investors
have been nervously watching the group since the cancer ruling in the US over
Monsanto's leading product Roundup, which contains glyphosate.
Investors have been nervously watching the group since the cancer ruling in the US over Monsanto's leading product Roundup, which contains glyphosate. |
Chemical
campaigners and politicians in the US and Europe argue that glyphosate causes
cancer, although Bayer points to scientific studies finding no connection.
In October,
a San Francisco judge upheld a jury verdict that found Monsanto liable for not
warning a groundskeeper that its weed killer product Roundup might cause
cancer, but slashed the damages award to $78 million from the initial $289
million.
By the end
of last month, the US subsidiary was facing 9,300 cases over glyphosate.
But Baumann
had stuck to its confident outlook in integrating Monsanto.
He
acknowledged that more lawsuits could come, but reiterated that Bayer would
"defend ourselves with all means available."