Bayer Starts EU1.2 Billion Share Sale for Schering
: "July 6 (Bloomberg) -- Bayer AG is selling 1.2 billion euros
($1.53 billion) in new shares to help fund its takeover of rival
drugmaker Schering AG.

The sale of 34 million new shares to institutional
investors will probably be completed today, the company said in
a statement distributed by DGAP. At yesterday's closing price of
35.68 euros, the sale is worth 1.2 billion euros. Buyers will
get the full-year dividend, Bayer said.

Bayer wants to add Berlin-based Schering's best-selling
multiple sclerosis treatment and Yasmin contraceptive pills to
bolster its healthcare unit. The share sale is one of the final
steps in financing the 17 billion-euro purchase after Bayer sold
its medical diagnostics unit to Siemens AG and issued bonds
worth 2.3 billion euros over the past month.
``
Bayer is moving ahead with the financing,'' Silke
Stegemann, an analyst at Landesbank Rheinland-Pfalz in Mainz,
said in an interview today. ``Bayer is on the right path. A
capital increase always puts pressure on the stock.''

Bayer shares fell 63 cents, or 1.8 percent, to 35.05 euros
at 11:34 a.m. in Frankfurt. They've shed 1.2 percent this year.

The developer of aspirin said last week it expects net
proceeds of 3.6 billion euros from the sale of the diagnostics
division to Siemens. Bayer is also planning to sell its Wolff
Walsrode and HC Starck units.

Job Cuts

Schering will help bolster Bayer's health-care unit with
Betaseron and the world's biggest stable of birth-control pills.
Growth at the enlarged company will be led by new products and
demand for cancer drugs such as Bayer's Nexavar, Chief Executive
Officer Werner Wenning said last month. The drug was approved in
the U.S. last December to treat kidney cancer.

Bayer HealthCare suffered from the recall of the
cholesterol-lowering Baycol in August 2001 and the introduction
of generic rivals to its Cipro antibiotic two years later. While
first-quarter operating profit at Bayer's health care and
pharmaceutical units more than doubled, their operating margins
lag behind U.S. industry peers including Johnson & Johnson and
Pfizer Inc.

Leverkusen, Germany-based Bayer last month had to raise its
bid for Schering by 3 euros a share to 89 euros to persuade
rival Merck KGaA to tender its 21.8 percent stake. As many as
6,000 jobs may be cut in the integration, the company has said...."