Bayer Loses Millions Because of Lawsuit
German pharmaceutical giant Bayer is losing millions of dollars from legal setbacks regarding their recent acquisition, Monsanto. The case in questions is a lawsuit that was filed in San Francisco, claiming that Monsanto's Round-Up weed killer caused a man's cancer. That case was recently settled in the man's favor, causing Bayer to pay a large monetary sum, and leading to thousands of new lawsuits also claiming that Round-Up led to medical problems and cancer for people.
Monsanto is a pretty new purchase for Bayer, and this onslaught of lawsuits and bad publicity is causing their stocks to fall as investors lose confidence in Bayer. Before Bayer bought Monsanto many had said that it was a bad move for the company to make, because Monsanto already has a bad reputation to environmentalists due to their GMO products and use of chemicals and pesticides.
Bayer plans to fight the outcome of the suit to prove that Round-Up was not the cause of the man's cancer, but the damage has already been done, as Bayer's stocks continue to fall. Right now Bayer needs to try to fix their reputation with the public in order to gain their trust again.
Great article, I know mergers and acquisitions happen for different reason. Some are:
ReplyDeleteCompany A wants to expand, so they mergers/acquires with company B
Company A and B are both going bankrupt so a merger is the only solution
So in this case, most likely Bayer saw an opportunity and took advantage of the situation.
This was a well written summary of the merger/acquisition of Bayer and Monsanto. I believe that Bayer could have done more research or consulted with more people before purchasing Monsanto. Monsanto has had bad publicity and is not known for good things.
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