German Conglomerate Bayer Faces Investor Scrutiny Amid Unexpected Legal, Trial Setbacks

Bayer AG BAYRY BAYZF reportedly held an investor call to address concerns after intense scrutiny from investors following a series of unforeseen setbacks, prompting questions about transparency surrounding its recent $5.75 billion bond issuance. 

The company encountered a cascade of issues, including a major setback in a late-stage anti-clotting drug trial that led to its abrupt termination. 

This development, coupled with adverse legal rulings, where Bayer was ordered to pay substantial sums over its Roundup weed-killer, triggered uncertainties among bond investors.

Citing Andrew Brady, Head of Basic Industries Research at CreditSights, Reuters, in its report, highlighted investors' discontent, expressing concerns over whether Bayer's management hurried the bond issuance preceding the release of distressing news. 

Bayer's bankers engaged in discussions with top stakeholders to assuage anxious investors. During these talks, investors sought clarification on the potential impact of these setbacks on the company's financial outlook. 

Bayer emphasized its financial reserves to address Roundup litigation, asserting the unpredictability of jury verdicts.

Despite these challenges, Bayer priced bonds with maturities spanning three to 30 years, attracting orders exceeding $22 billion, marking it as one of the ten largest investment-grade bond deals by an industrial company this year.

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