BAYRY - Bayer extends gains amid report of activist investor push for breakup

Bayer ( OTCPK:BAYRY ) ADRs extended earlier gains, now up 7.6%, amid a report that an activist investor has built a stake and is pressuring for a breakup of German agriculture and drug company.

Bluebell Capital Partners has built an undisclosed stake and wants Bayer to separate its crop sciences business from its drug business, according to traders, who cited a Bloomberg report. The move could help unlock 70% for shareholders.

The activist also wants Bayer to explore a sale or a listing of its consumer health unit, according to the report.

The latest news comes after activist investor Jeff Ubben reported a more than $400 million stake in Bayer on Monday. Ubben wants the company to hire a chief executive from outside the company, he told the FT in a interview.

Bayer ( OTCPK:BAYRY ) shares have been weighed down by the threat of further litigation over alleged carcinogenic effects of its weedkiller Roundup; the stock's market value for all its businesses totals ~$50B, well below the $63B deal value for its 2018 takeover of Roundup-maker Monsanto.

Ubben told the FT that Bayer management should consider new options to resolve the glyphosate litigation, including splitting into two separate entities in order to ringfence legal liabilities in a new entity,

Bayer shares also rallied after  Bayer raised it forecast for peak sale its pharma portfolio €12 ($13 billion).

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