Bayer to establish management holding company with operating subsidaries

Bayer to establish management holding company with operating subsidaries

Bayer plans to transform its current organizational structure into a management holding company with independent operating subsidiaries.

Merging Bayer's Rubber, Plastics, Polyurethanes, as well as Coatings and Colorants business groups will create one of the world's largest polymers companies, with sales of more than EUR 11 billion. Bayer is already a world leader in the manufacture of polyurethane raw materials, coating raw materials, specialty rubbers, and engineering plastics such as Makrolon, the material for CDs and CD-ROMs.

The new company will capitalize on major synergies through shared technological structures - especially in manufacturing, logistics and marketing - and a common IT platform. With customer industries increasingly requiring single-source suppliers and service back-up, the new company's operations will be aligned toward markets and customer industries - such as automotive, electrical/electronics and construction - thus opening up further business opportunities. "In an improved economic climate our polymers business can achieve a 15 percent operating margin and generate the cash flows necessary for sustained value creation, which is very much in the interests of our stockholders and employees," said Schneider. "We are strong enough in polymers to grow organically and expand from our existing position."