Elanco in talks to buy Bayer animal health unit

July 18, 2019

Representatives from Bayer AG and Elanco Animal Health are exploring a way to get Bayer out of the animal health game and combine their units into an even bigger player in the veterinary industry, according to Reuters.

German drug maker Bayer AG has approached Elanco Animal Health, headquartered in Indiana, about a “possible combination of their pet-health businesses,” according to Reuters.

Industry sources count Elanco's and Bayer's animal health units among the top animal health companies in revenue worldwide. Combining their animal health assets would create an even bigger player in the industry.

Representatives of the two companies are in talks with banks to check on any regulatory issues with a potential sale. A direct sale of Bayer's animal health assets to Elanco might be cost-prohibitive, so sources figure Bayer would need to retain a stake in the new animal health industry giant, according to sources quoted by Reuters.

Bayer announced back in November that it wanted out of the animal health industry to focus on core businesses in pharmaceuticals, consumer health and crop science. The company has been under pressure from investors to raise money after buying Monsanto and becoming embroiled in that company's lawsuits related to the Roundup weed killer.