Bayer to sell diagnostics business to Siemens for EUR 4.2 bn

Mumbai, June 30 (UNI) Bayer Diagnostics India has said that the Bayer Group plans to sell the diagnostics division of Bayer HealthCare to Siemens AG, Munich, Germany, for EUR 4.2 billion.

Announcing this, the company said the divestment was approved on June 30, 2006 by the Bayer supervisory board.

The systems business of the diagnostics division with its emphasis on hardware, IT networking and comprehensive equipment service, is subject to success factors different than the other Bayer HealthCare divisions.

Bayer is therefore divesting these activities as part of the consolidation phase in the diagnostics market. Closing of the transaction is expected for the first half of 2007, subject to the approval of the antitrust authorities.

The consumer-influenced diabetes care division is not affected by the transaction, nor is the contrast agents (diagnostic imaging) business of Schering AG, which will form an important part of the future Bayer Schering Pharma AG. For Bayer, the after-tax proceeds of the divestment will be about EUR 3.6 billion.

In March this year, Bayer had already issued a mandatory convertible bond in the amount of EUR 2.3 billion as a first step.

The effect of this divestment is to substantially reduce its debt, thus helping to improve credit profile.

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