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SHARE IN FOCUS 2: Positive signals in the US glyphosate dispute are driving Bayer | message


(New: additional analysts vote, closing price)

FRANKFURT (dpa-AFX) – Improved prospects for an early settlement in the glyphosate dispute in the United States brought Bayer shares (Bayer) a strong price increase on Tuesday. The papers of the pharmaceutical and agrochemical group closed with a profit of 5.75 percent at 72.60 euros and were thus the second strongest value in the Dax (DAX 30). Since their multi-year low in the wake of the Corona crash in mid-March at 44.86 euros, the Leverkusen titles have made an impressive recovery of more than 60 percent.

As the “Handelsblatt” reported on Tuesday, referring to circles of negotiating partners and the company, Bayer is facing a billion-dollar comparison with the Gyphosat claimants in the United States. There is an agreement ready for signature, but the supervisory board still has to advise and vote, the paper writes.

The amount of the comparison is said to be between 8 and 10 billion US dollars. Two billion dollars of this are considered “reserves” with which Bayer can settle the claims of future plaintiffs. The agreement should be announced later this week. Bayer did not want to comment on the report on request. The comparison sum named by the “Handelsblatt” would even be lower at the lower end than analysts had recently estimated.

If all glyphosate proceedings against the payment of a maximum of $ 10 billion were actually stopped, this would be a significant price driver for the share, explained Baader Bank analyst Markus Mayer. At the current price level, a glyphosate discount of at least $ 25 billion was priced in. The expert confirmed his buy recommendation for Bayer shares.

His colleague Keyur Parekh from the US investment bank Goldman Sachs estimated that stopping all glyphosate processes for the reported amount would make Bayer shares more valuable by 7 to 9 euros. He also retained his vote to buy the papers.

With the prospect of comparison, the talks on an extrajudicial settlement in the glyphosate case that have been going on since late summer 2019 come to an end. The last time they pulled in was because of the corona pandemic. In addition, not all major US law firms agreed to the agreement. This is apparently the case now, because according to the “Handelsblatt” circles it is a nationwide agreement.

Bayer only managed to secure an important stage victory in the US litigation about possible cancer risks of the weed killer Roundup containing glyphosate. A federal judge in Sacramento ruled that Bayer in California did not have to point out possible cancer risks of the drug.

Bayer had brought the glyphosate problems into the home with the $ 60 billion acquisition of Monsanto. After three lost lawsuits and high damages judgments for alleged cancer risks from weed killers, tens of thousands of US lawsuits are pending./edh/ck/jha/mis


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