Bayer gets €3bn from Apollo for contraceptives unit stake
Bayer has partnered with private equity group Apollo to set up a new entity that will handle its long-acting contraceptive business, but still allow the pharma group to retain overall control.
Apollo is giving Bayer €3 billion ($3.4 billion) in equity capital for a minority, non-controlling stake in the long-acting, reversible contraceptive (LARC) unit, which will take responsibility for hormonal intrauterine system (IUS) products like Mirena, Kyleena, and Jaydess/Skyla, as well as subdermal implant Jadelle.
The IUS products collectively recorded sales of €1.37 billion last year, growing by more than 12% on higher volumes and demand in the US, and it is Bayer's fourth-largest product category. The group is the dominant player in the category worldwide.
Bayer will retain "complete operational control over the business," said the private equity firm, which added that revenues from the LARC products will continue to be recorded in the drugmaker's financial results.
"This transaction represents a strategic financing solution that strengthens our capital structure while preserving full operational control over this core pharmaceuticals business," said Bayer chief financial officer Dr Judith Hartmann.
"It enhances our financial flexibility as we manage increased liquidity requirements this year related to bond maturities and litigation procedures, while continuing to execute our long-term priorities," she added.
Bayer is facing high litigation costs relating to its Roundup glyphosate herbicide product, a legacy of its $66 billion takeover of agricultural products company Monsanto several years ago, with thousands of lawsuits claiming a link to cancer.
Meanwhile, Bayer is in the midst of a restructuring drive aimed at building its core pharma business and trying to make the group faster, more agile, and less bureaucratic. In May, it agreed its first biopharma acquisition in years, paying $300 million upfront for privately-held US biotech Perfuse Therapeutics and its novel drug implant for eye diseases.
The Apollo transaction is expected to close in the third quarter of 2026, subject to approval by antitrust authorities and customary closing conditions.
"This transaction reflects the core purpose of Apollo's High Grade Capital Solutions platform – providing large, flexible, and bespoke capital to blue-chip corporations – enabling Bayer to strengthen its balance sheet while retaining full operational control over a core business," said Apollo partner Jamshid Ehsani.
