FRANKFURT Oct 13 Bayer has
short-listed India's Lupin and investor BC Partners
as prospective buyers of medical skin cream assets in a
potential 1 billion euro ($1.1 billion) deal, several people
familiar with the sale told Reuters.
Germany's Bayer has for more than two years sought to narrow
the focus of its healthcare division and its planned $66 billion
Monsanto takeover has added urgency to that drive.
Bayer has, however, said a debt package and cash call would
suffice to finance the Monsanto purchase, its largest ever
Lupin is mainly attracted by the Bayer dermatology
business's regional presence in North America, where the Indian
maker of generic and specialty drugs is keen to expand, one of
the sources said. Buyout firm BC Partners, in turn, has for a
while tried to add more healthcare assets to its portfolio.
It could not be learned how many other prospective buyers
are still in the race.
The Bayer unit sells established skin cream brands such as
Desonate against allergic skin reaction, Finacea to ease rosacea
symptoms as well as acne treatment Skinoren.
The business is expected to fetch close to 1 billion euros
at least, or more than 9 times its expected core earnings of
more than 100 million euros.
Lupin was not immediately available for comment, while BC
Partners and Bayer declined to comment.
Bayer has been shedding assets such as vascular catheters or
blood glucose meters. It is exploring the sale of its $3 billion
radiology contrast agents unit but the dermatology auction is
taking precedence for now, according to people close to the
Bayer has already looked into initial offers and picked some
suitors to advance to the second round of bids, which are due in
the coming weeks, the sources said.
Drugmakers Mylan and Almirall as well as
Nestle have lost interest in the asset, they said.
Industry experts said financial investors were attracted by
the mature brands' reliable income stream while drug makers were
discouraged by their limited growth prospects.
($1 = 0.8928 euros)
(Additional reporting by Carl O'Donnell and Martinne Geller;
Editing by Maria Sheahan)