International. Bayer announced that it has definitively ceded control of Covestro AG. With the sale of another 6.9 percent of Covestro's shares for one billion euros, the direct interest held by Bayer AG has now been reduced to 24.6 percent. In addition, Bayer Pension Trust continues to hold 8.9 percent. "Through the move, we have taken a big step towards our goal of achieving full separation from Covestro in the medium term," said Werner Baumann, Chairman of the Board of Directors.
The buyers have agreed to be subject to a lock-in agreement under which they will not sell the shares they have just bought until at least December 11, 2017. In addition, Bayer and Covestro have signed a termination of control agreement, as part of Bayer's commitment not to exercise certain voting rights at Covestro's Annual Shareholders' Meeting. This ensures that Covestro will no longer need to be fully consolidated in Bayer's consolidated financial statements.
Covestro will be reported as a discontinued operation in Bayer's financial reports for the third quarter of 2017. For continuing operations, Bayer's key data, such as sales, Ebitda before special items, EBIT and basic earnings per share, will be adjusted retrospectively to exclude Covestro's contributions.
In addition, all assets and liabilities allocated to Covestro will not be shown in Bayer's statement of financial position as at 30 September. Covestro's remaining interest will be accounted for at current market value and, effective October 1, 2017, will be accounted for using the equity method.
