Bayer seeks outside advice on litigation as Elliott reveals stake
FRANKFURT (Reuters) - Chemicals giant Bayer, under pressure from activist shareholders, said on Wednesday it has hired an external lawyer to advise its supervisory board and has set up a new committee to resolve a multi-billion dollar glyphosate litigation issue.
Bayer faces massive legal issues in the United States where more than 13,400 plaintiffs allege the company’s glyphosate weedkiller Roundup, produced by U.S. unit Monsanto, caused cancer and that the company failed to warn about that risk. Bayer denies this.
Bayer said it has hired U.S. lawyer John H. Beisner from Skadden, Arps, Slate Meagher & Flom LLP to advise the Supervisory Board on matters related to the glyphosate litigations, including trial tactics and mediation.
“His appointment is intended to add fresh and independent perspectives to the advice given to the Board of Management,” the company said in a statement on Wednesday.
“We are convinced that with his expertise, John H. Beisner will provide very valuable and concrete advice on the ongoing litigation as well as the mediation,” Bayer’s Chairman Werner Wenning, said in the statement.
Bayer, which acquired Monsanto in a $63 billion deal last year, says studies and regulators have deemed glyphosate and Roundup safe for human use.
Bayer on Wednesday said a new Supervisory Board committee, comprised of eight supervisory board members, will consult with the Board of Management and make recommendations on litigation strategy.
Activist shareholder Elliott Associates revealed on Wednesday that it holds Bayer shares and financial instruments equivalent to 1.1 billion euros ($1.3 billion) worth of Bayer stock. It is the first time that Elliott has acknowledged holding a significant stake in the German company.
Bayer’s market value is 52.2 billion euros.
“Elliott welcomes these steps, and is confident that today’s statement marks a step change in Bayer’s approach to addressing the legal challenges currently facing the company,” Elliott said in a statement.
Elliott said it believes that the creation of the special committee will provide a new level of oversight and a fresh perspective to a litigation strategy, which it said needs a radical overhaul.
Reporting by Edward Taylor; Editing by Tassilo Hummel and Susan Fenton