Monday, August 13, 2018

Bayer (Monsanto) Stock Falls 10%; Europeans Resume Fight to Ban Glyphosate

Bayer recently purchased Monsanto for $66 billion, but the parent company has just lost $14 billion in its own stock price today.

According to the Washington Post, one analyst says that Bayer must have factored Monsanto's reputation risk in to the transaction, but no one knows how accurate its estimates may have been.

In a Bloomberg op-ed piece, Chris Hughes says stakeholders were right to be wary of Bayer's interest in Monsanto. Hughes says glyphosate accounts now for roughly 2 percent of Bayer's sales. "While Monsanto's former shareholders are completely off the hook, their Bayer counterparts look uncomfortably exposed," he wrote.

Quoted in Reuters, an analyst for Barclays said Bayer was in for a "litigious headache." Berenberg analyst Alistair Campbell (also quoted in Reuters) said the court cases could cost Bayer $5 billion (based on the company's liabilities over previous product liability cases (Vioxx and Baycol).

However the Johnson judgment of $289 million - with 4,000 to 10,000 more cases pending - is a drop in the bucket and the amount could be much higher.

Monsanto's new owner Bayer saw a 11% dip in its stock price.

Read about Europe's reaction to the Johnson trial in Politico here.

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