Bayer sells minority stake in contraceptives unit to Apollo for €3bn to ease litigation debt load

Bayer has brought in Apollo Global Management as a minority investor in its long-acting reversible contraceptives (LARC) business, a transaction that injects €3 billion of equity into the Leverkusen-based group. The deal, announced on Friday, creates a new entity housing the Mirena, Kyleena and Jaydess intrauterine device brands. Bayer retains a majority stake, keeps full operational control and will continue to consolidate the unit in its financial statements.

We are increasing our financial flexibility in light of the increased liquidity requirements this year due to bond maturities and litigation, while at the same time we can continue to consistently implement our long-term strategic priorities.

Why Bayer needs the cash

The Apollo investment is the latest step in Bayer's effort to repair a balance sheet battered by years of US litigation over its Roundup weedkiller. The company has already spent more than $10 billion on claims alleging that glyphosate, the herbicide's active ingredient, causes cancer. Bayer denies the allegations, pointing to regulatory findings that the product is safe when used as directed.

In February, Bayer announced a $7.25 billion class settlement designed to resolve future Roundup claims. Immediate funding for that settlement, together with upcoming bond maturities, was to be covered by an $8 billion bank loan facility before being refinanced through debt and hybrid capital instruments. Last month, the US Supreme Court gave Bayer a significant boost by ruling that the company cannot be sued for failing to include a cancer warning on its weedkiller packaging, a decision expected to undercut thousands of pending claims.

The contraceptives business

The LARC franchise is one of Bayer's fastest-growing pharmaceutical units. Sales of the product family rose 12.5 percent on a currency- and portfolio-adjusted basis to €1.37 billion in 2025, driven by strong demand in the United States. The business remains part of Bayer's core pharma division and the company declined to disclose the exact size of the stake sold or the financial details of the new entity.

Structured capital, not a buyout

The transaction reflects a broader trend of private equity firms pursuing structured capital deals rather than full acquisitions. Apollo framed the investment as a signature move for its High Grade Capital Solutions platform.

This transaction reflects the core purpose of our 'High Grade Capital Solutions' platform — namely, providing blue-chip companies with large amounts of flexible and tailored capital.

The deal is expected to close in the third quarter of 2026. A final court hearing on the $7.25 billion Roundup class settlement is scheduled for 19 August.

Portfolio reshaping continues

Earlier this month, Bayer transferred its US glyphosate business into a wholly owned subsidiary, a move that further separates the Roundup legacy from the rest of the group. The Apollo deal and the glyphosate restructuring together show a company trying to isolate litigation risk while preserving growth engines such as the contraceptives franchise.