The acquisition of the US company Monsanto has provoked strong criticism of shareholders and vocal protests at the door of the management of the group of agricultural chemicals Bayer. At the annual assembly in Bonn on Friday, a number of major shareholders discussed the matter, which went to court with the Board of Directors and the Supervisory Board.
Mark Tumler of the German Securities and Exchange Association (DSW) said: "Never before has Dax lost its reputation and value so fast in terms of scratching images caused by the US Glyphosate lawsuit and the rapid drop in stock prices Bayer on the stock market – it's a shame. "
The criticism came from analyst Jan Verning of investment company Union Investment: "The management of Bayer has legal risks from the Monsanto agreement, which is obviously underestimated." Since 2018, Bayer has undergone two court cases in the United States, the group was doing too much damage to cancer patients convicted. On the other hand, Bayer appeals. Overall, Leverkusen, which took over competitors and seed producer Monsanto in 2018, now has to bring 13,400 claims for glyphosate damage – and the number is likely to increase.
Bayer CEO Werner Bauman confirmed that glyphosate was a "safe product when used properly". Regarding cancer patients in the United States, the manager said: "Products based on glyphosate do not cause their serious illnesses."
Bauman's conviction, however, could not calm the deep concerns of the present shareholders. Monsanto's legal risks for the long-standing company founded in 1863 were "enormous and priceless," complained Nicola Huber of the subsidiary of Deutsche Bank DWS. "We shareholders are very concerned about the continued existence of a 150-year-old and largely successful German industrial history." Ingo Spich of Deka, one of the 10 shareholders of Bayer, spoke of "chaos" and said that given the price erosion: "In just two years, the former pharmaceutical giant mutated into a dwarf." There is a danger of being taken or even to break.
Bowman responded calmly to the criticism and stuck to his line: he should not shine above the price falling, but Monsanto's acquisition was the right step in the long run. "We still think that the acquisition of Monsanto is valuable and strategically accurate."
The acquisition was thoroughly tested in advance, Bauman said. But is it possible even to assess the legal risks in advance? Shareholders raised doubts – Monsanto was also quoted on the stock exchange, most likely the Americans were not allowed to place all the cards at the table during the takeover negotiations. Baumann also let this shame roll – the due diligence of the company was "commonplace."
The criticism of shareholder meetings is – also in Bayer – quite common. On the other hand, their sharpness and the announcement of several major shareholders did not want to release the Board of Directors and the Supervisory Board on Friday. Just a year ago, Bowman was able to get an approval of a good 97%, but on Friday there was significantly lower value. In 2002, due to the Lipopai scandal for the then Board, only 90 percent were – previously Bayer had a cholesterol-lowering, which was associated with several deaths withdrawn from the market.
Although the low ratings for approval do not have direct consequences for the management of joint stock companies, they are the main icing – in the case of Bayer, this could weaken the position of CEO Bauman. A 56-year-old emphasis in cross-examination by shareholders that stock prices will recover: "We are doing everything possible to bring back the value of our company back to the areas it belongs to." He also pointed to good figures – in fact, Bayer Overall, the development of the business was good at the very beginning of the year and sales increased significantly.
On Friday afternoon there was a marathon for meetings – the list of speakers was more than 60 shareholders. At the beginning of the annual meeting, the chairman of the meeting and chairman of the supervisory board, Werner Vening, apologized to shareholders about the losses in prices: "I very much regret it."
About 3,600 shareholders gathered in the WCCB Conference Center in Bonn. Up to 700 protesters loudly protested at the doors of the building – most of them are young people from Friday's Future movement. Large agribusinesses, such as Bayer, are bad for the environment, and hence for the future, said activist Felix Paul. The Rural Agriculture Working Group (ABL) called for a rally. Bayer's long-time critics warn against the influence of large corporations, such as Bayer, the peasants in dependence and agriculture, which is long-term damage.