German conglomerate Bayer AG (BAYZF.PK,BAYRY.PK,BYR.L) is exploring a sale of its diabetes device unit, Bloomberg reported Monday, citing people with knowledge of the matter.
According to the Bloomberg report, Credit Suisse Group AG is advising Bayer on a potential sale of the unit, which could fetch between 1 billion euros and 2 billion euros, or $1.24 billion to $2.49 billion. Private equity firms like Cinven Ltd., EQT Partners AB and Triton Advisers Ltd. may reportedly consider bidding for the unit.
Bayer's diabetes devices unit makes products, including the blood-glucose meter Contour, which had annual sales of more than 700 million euros in 2013. The business is part of the company's health-care unit.
Bloomberg also reported that Bayer is interested in acquiring animal health company Zoetis Inc. (ZTS), a former unit of Pfizer Inc. (PFE). The company is seeking to raise money for the acquisition of Zoetis from the listing of its plastics unit and the sale of its diabetes devices unit.
In October, Bayer said its MaterialScience business will be floated on the stock market as a separate company latest by mid-2016, thus making Bayer a pure life science company that will focus on Healthcare and CropScience. Citing its strong operating performance and including the consumer care business acquired from Merck & Co., Inc. Bayer raised its financial guidance for 2014 at that time.
Bayer had earlier said its plan to divest plastics business and focus entirely on life science, that would position itself as a world-leading company in the field of human, animal and plant health.
Healthcare giant Merck & Co., Inc. (MRK) said in early October that it completed the sale of its consumer care business to Bayer, including the global trademark and prescription rights for Claritintm and Afrintm, for $14.2 billion.
Bayer gets Merck's existing over-the-counter drug business with about 2,250 employees. The unit's business primarily includes leading brands such as Claritin for allergy, Coppertone for sun care, Dr. Scholl's for foot health, and Afrin for colds.
BAYZF closed Monday's trading at $147.75, up $4.35 or 3.03 percent on a volume of 747 shares.
In Frankfurt, Bayer's shares closed Monday's trading at 117.45 euros, down 0.55 euros or 0.47 percent on a volume of 2.42 million shares.
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