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All of your debt instruments now have change-of-control clauses. Is this now standard, and do
you feel it will protect you against a hostile takeover?
This trend has been in place for some time now and serves to protect investors. The aim is to give
investors the opportunity to redeem bonds in the event of a change within the company. It is not
primarily intended as protection for the company. The best defense against an unwanted takeover is
clearly a high share price.
There will be substantial changes in the statement of financial position, however. After all, a
major proportion of non-current assets will go to BMS. What assets will remain with Bayer?
We have a very high level of intangible assets. With regard to equity and liabilities, we intend things
to remain the way they are today. When I talk to investors or rating analysts, they mainly look at
future cash flows, or the ratio of cash flows to debt – the latter being the main factor.
The Bayer Group's risk profile will also change as a result of the carve-out. Will the company's
rating come under pressure?
We of course discussed this issue in advance with the rating agencies. They regard the planned stock
market flotation of BMS as neutral to our rating. An IPO could even have a positive effect on the
rating because it would strengthen our equity.
IAFEI Quarterly | Issue 29 | 31