Bayer to kick off sale of $2.4 bln pest control unit this summer - sources
FRANKFURT, March 30 (Reuters) - German chemicals group Bayer (BAYGn.DE) is preparing to kick off the sale of pest control unit Bayer Environmental Science (BES) this summer with a price tag potentially topping 2 billion euros ($2.4 billion), people close to the matter said.
The agrichemicals giant, looking to reduce debt in the wake of its $63 billion purchase of U.S. peer Monsanto in 2016, is working with Bank of America (BAC.N) on the sale, the people said, speaking anonymously as the information is not public.
While introductory meetings with prospective buyers are already taking place, an auction will officially start just before or after the summer break, with the view of signing a deal by the end of the year, they added.
Bayer and Bank of America declined to comment.
Bayer is planning to market the unit, which supplies products like pesticides for golf courses and rodent protection for warehouses, to peers such as Scotts Miracle-Gro (SMG.N), ICL (ICL.TA) as well as private equity groups, the sources said.
BES last year saw revenues increase by 7.6% to 1.1 billion euros, while most other units of Bayer's CropScience division saw sales slump on weak trading in North America.
Bayer is only divesting the business for professional users with sales of 600 million euros, Chief Executive Werner Baumann said in an analyst call last month.
That part of BES is expected to post earnings before interest, tax, depreciation and amortisation of about 200 million euros this year and could be valued at 10-12 times that, the sources said.
Since the Monsanto acquisition, Bayer has already sold its 6 billion euro animal health business, its stake in 3.5 billion euro chemicals park Currenta, as well as consumer brands such as Dr. Scholl's and Coppertone worth about 500 million euros each.
Its net debt stood at 41.9 billion euros as of December 2020, while its net financial debt stood at 30 billion.
($1 = 0.8527 euros)
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