Merck KGaA sells up to Bayer and resolves differences

Merck KGaA has agreed to sell its shares in Schering AG to Bayer, after Bayer said it would sue Merck KGaA for seemingly trying to block its buyout of Schering without good reason.

After talks between Werner Wenning, Bayer’s chief executive, and Merck KGaA’s chairman, Dr Michael Roemer, the two companies agreed to settle their differences and allow the creation of Bayer Schering Pharma.

Merck KGaA, which bought a 21.4 per cent stake in Schering AG during the last two weeks, said it had profited by 400 million euros (273.5 million pounds) from its investment, which Bayer had earlier condemned as “incomprehensible” and an attempt to “harm” Schering AG’s future.

However, Dr Roemer said that profiteering was not behind Merck KGaA’s actions. He remarked: “Short-term profit gained through speculation was never our goal and is certainly not a motive for a company that thinks in generations. But, when an option to secure ones position arises, a company has the responsibility to make every possible effort right up to the very end.”

Mr Wenning stated: “We’re very pleased about Merck’s decision, because a lengthy competitive bidding process would have greatly affected Schering’s future. All three companies concerned will benefit from this step.”

“Today we have taken a major step toward creating a world-class German pharmaceutical company,” he concluded.

Bayer has withdrawn its lawsuit and has also agreed to have further discussions with Merck KGaA about the possibility of future cooperation between the two companies.

Merck KGaA had attempted to buy Schering AG before Bayer, but its bid was rejected as Schering’s board felt the offer was too low.

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