Bayer appoints Roche veteran Anderson as chief executive

Bayer has appointed Roche’s former head of pharmaceuticals Bill Anderson as chief executive as the German conglomerate grapples with growing criticism from shareholders.

The Leverkusen-based group announced chief executive Werner Baumann will leave by the end of May, almost a year before his contract expires, in a statement after Wednesday’s market close.

It follows pressure from investors including activist Jeff Ubben, who has called for a new chief executive and been critical of the group’s ill fated acquisition of US seed maker Monsanto in 2016.

Shares in Bayer rose 6 per cent to €62.49 by the Wednesday close. They have risen more than 20 per cent this year, outperforming the wider German market as investors have anticipated change at the top and a fresh start.

However, the stock has still not recovered from the costly Monsanto takeover. The shares hit $143.88 in April 2015.

The $63bn Monsanto deal was executed despite opposition from shareholders and exposed Bayer to billions of dollars in litigation costs linked to law suits about Monsanto’s weedkiller Roundup, which allegedly caused cancer. Bayer maintains that the product is safe.

Analysts, investment bankers and activist shareholders have long argued in favour of a break-up of the German conglomerate whose two main divisions pharmaceuticals and crop science have few synergies.

Bayer’s chair Norbert Winkeljohann described the incoming chief executive as the “ideal candidate” for the German group, adding that his mandate was to “realise [the group’s] full potential and create sustainable value”.

Bayer said that Anderson will join the executive board in April, and will then replace Baumann in June.

The outgoing chief executive “will work closely with Bill Anderson to ensure a smooth transition process before retiring from Bayer at the end of May 2023”, the company said.

It added that the appointment was the result of a “diligent search and selection process”, which was launched in the middle of last year.

“Bill Anderson is a very good choice for Bayer,” said Markus Manns, a portfolio manger at Germany’s third largest asset manager Union Investment, adding that he brings expertise from Roche.

Anderson, a US citizen, is a chemical engineer, who left the Swiss drugmaker after a 17 year stint, most recently as head of its pharmaceutical division.

According to his LinkedIn profile, he is “preparing for my next assignment”.

In a statement published by Bayer on Wednesday, he said the company was “already delivering tremendous benefits for the nutrition, health and environmental protection of the world”.

He added that his ambition was to “accelerate innovation, increase performance, advance sustainability and unleash the full potential of the company”.

In 2019, Baumann and other executives lost a crucial vote of confidence at the company’s annual shareholder meeting. Although non-binding, the vote was a symbolic rejection and blow for the management.

However, despite the investor revolt, the supervisory board extended Baumann’s contract one year later until 2024.