icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm
4 Nov, 2020 08:13

Bayer takes more than $10 BILLION write-down over Monsanto’s Roundup weed killer

Bayer takes more than $10 BILLION write-down over Monsanto’s Roundup weed killer

German pharmaceutical giant Bayer said it’s facing a double hit from a higher legal bill for claims relating to weed killer Roundup and €9.25 billion ($10.8 billion) in impairments on Monsanto-related agriculture businesses.

According to the company, the write-downs were driven by weaker demand from farmers due to low biofuel prices and an increase of about $750 million in the costs of settlement terms with US plaintiffs over Roundup. As a result, the losses before interest and tax amounted to €9.4 billion ($10.9 billion) in the third quarter.

“The impact of the (coronavirus) pandemic is placing additional strain on our Crop Science Division. We are also facing negative currency effects,” Chief Financial Officer Wolfgang Nickl said as quoted by Reuters.

Nickl explained that a massive depreciation of the Brazilian real was weighing heavily on the firm’s business in the world’s second-largest agricultural market.

Bayer said it was unable to say what part of the impairment was attributable to legacy Monsanto businesses, saying only that two-thirds of the write-downs were due to currency and interest rate effects.

Also on rt.com Canada launches major class-action lawsuit against Monsanto’s Roundup & owner Bayer

Bayer has been under fire and facing a wave of lawsuits in the US over Roundup since its 2018 takeover of Monsanto for about $63 billion. The deal made Bayer the world’s largest supplier of seeds and pesticides.

In June, Bayer struck an $11 billion outline agreement with US plaintiffs’ lawyers, but a judge later took issue with a side arrangement on future cases that may yet be lodged, known as a class plan.

READ MORE: After cornering GMO crop market with Monsanto takeover, Bayer turns its eyes to imitation ‘meat’

Addressing those concerns will prove about $750 million more costly, Bayer said, adding it was “far enough along in the negotiations to know that the new plan will come in at approximately $2 billion, an increase over the original cost of $1.25 billion.”

The company said that 88,500 of the 125,000 glyphosate-related claims in the class settlement have been agreed in principle and that it was hoping to make considerable progress over the next few months.

For more stories on economy & finance visit RT's business section