7-Business: Bayer's CropScience purchase leaves six agrochemical giants

[GENET <genetnl@xs4all.be>]

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                                  PART I
-------------------------------- GENET-news --------------------------------

TITLE:  Bayer's CropScience purchase leaves six agrochemical giants
SOURCE: European Chemical News via NewsEdge Corporation
        http://www.soyatech.com/bluebook/news/viewarticle.ldml?article=
        20010920-6
DATE:   September 20, 2001

------------------ archive: http://www.gene.ch/genet.html ------------------


Bayer's CropScience purchase leaves six agrochemical giants

Bayer's purchase of Aventis CropScience continues a trend of consolidation 
in the global agrochemicals sector. If the transaction proves successful, 
70% of the sector's business will be conducted by just six companies.

The top six agrochemicals companies in 2000 were
Syngenta (with agrochemicals sales of $5888 M and seed/biotechnology sales 
of $958 M);
Monsanto (with agrochemicals sales of $3605 M and seed/biotechnology sales 
of $1608 M);
DuPont (with agrochemicals sales of $2027 M and seed/biotechnology sales of 
$1838 M);
Aventis (with agrochemicals sales of $3480 M and seed/biotechnology sales 
of $247 M);
BASF (with agrochemicals sales of $3336 M);
and Dow Chemical Co (with agrochemicals sales of $2086 M and seed/
biotechnology sales of $185 M).

Sales are tabulated for the top 15 agrochemicals companies. In 2000 the 
global traditional agrochemicals market was valued at $27.8 bn (0.9% lower 
than for 1999).

Trading conditions are described as challenging, with the decrease due to 
the low profitability of farm products, economic weakness in Latin America 
and Asia, and lower demand for traditional crop protection products as 
insect resistant and herbicide tolerant crops are increasingly used.

Of total agrochemicals sales, the percentage of generic products sold has 
fallen to 30.2% from 35.6% in 1998. Proprietary products accounted for 35% 
in 2000 and 37% in 1998, whilst proprietary off-patent products accounted 
for 35% in 2000 and 30% in 1998.

These market shares are not expected to change significantly in the short 
term. Forecasts for 7 agrochemical sectors for 2005 are tabulated. Demand 
for herbicides is expected to fall by 0.3%/y between 2000 and 2005, whilst 
demand for insecticides should rise by 0.6%/y. Demand for fungicides will 
rise by 1.0%/y whilst demand for biotechnology products is set to increase 
by 13.8%/y.


                                   PART II
-------------------------------- GENET-news --------------------------------

TITLE:  UPDATE - Bayer to take on no risks from StarLink
SOURCE: Reuters
DATE:   September 21, 2001

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UPDATE - Bayer to take on no risks from StarLink

FRANKFURT - Bayer AG said yesterday it would not assume any risks 
associated with compensation suits linked to genetically modified StarLink 
corn in its planned purchase of Aventis SA's CropScience unit. "We're not 
taking on any risks associated with StarLink," a Bayer spokesman said. 
CropScience faces claims from U.S. food companies after StarLink, not 
approved for human consumption, was found in many brands of taco shells and 
chips. Bayer has repeatedly said it expects to agree on its planned 7-7.5 
billion euros ($6.49 billion-$6.96 billion) acquisition of CropScience by 
the end of September.

Industry sources told Reuters in late July that Bayer would buy CropScience 
from the Franco-German drugs group and Berlin-based Schering AG for around 
7.25 billion euros, including debt. Schering owns a 24-percent stake in the 
unit. CropScience would more than double Bayer's existing business in the 
field, propelling it to number two from number six in the $33 billion 
annual agrochemicals global market, just behind Switzerland's Syngenta AG . 
Analysts have said the price for CropScience could vary by some 300 million 
euros or more depending on whether StarLink liabilities are included.

Bayer, Europe's second largest chemicals group, has already said it expects 
some 500 million euros in annual synergies to be achieved by 2005 from the 
CropScience deal, with 500 million euros in restructuring costs booked over 
a three-year period. By 2005, Bayer's agrochemicals operations would have 
annual sales of 8.1 billion euros, with a margin based on earnings before 
interest and tax (EBIT) of 20 percent.

By 1705 GMT, the stock was down 8.78 percent at 27 euros compared with a 
5.25 percent fall by the DAX index , which was stung by continued concerns 
of a military action after last week's suicide attacks on New York and 
Washington. Bayer shares have tumbled 40 percent since August 8, when the 
drugs/chemicals conglomerate withdrew key anti-cholesterol treatment Baycol 
after reports of deaths due to side effects.



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|                   GENET                     |
| European NGO Network on Genetic Engineering |
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