November 07, 2003
Werner Wenning continues systematic realignment:

Bayer plans stock market flotation for chemicals activities and strategic refocus of health care business

Supervisory Board approves Management Board plans / Focus on core businesses should enhance Bayer’s competitiveness / New company to be positioned among Europe’s leading chemical enterprises / Pharmaceuticals business to be retained as stand-alone solution

Leverkusen, November 7, 2003 - Following its successful reorganization, the
Bayer Group intends to maintain its focus on its core businesses and in the
future concentrate on health care, nutrition and innovative materials. For this
reason, Bayer Chemicals (excluding H.C. Starck and Wolff Walsrode) is to be
combined with certain parts of the polymers business in a new company with the
provisional name "NewCo". The aim is for this company to be listed on the stock
market under a new name by early 2005 at the latest. The Supervisory Board
approved these plans of the Group Management Board at its meeting today. CEO
designate of the new company is Dr. Axel Claus Heitmann (44), currently a
member of the Executive Committee of Bayer Polymers and head of that company's
Asia region, headquartered in Shanghai.

"Both Bayer and NewCo will benefit from the split, because a stock market
listing will be highly attractive for both shareholders and employees,"
explained Bayer CEO Werner Wenning. "Following the separation, Bayer - with
sales of around EUR 22 billion - will be able to focus more closely on the core
businesses in which we have excellent technologies, strong market positions and
above all growth areas that we intend to further strengthen by pooling all our
resources. In this way, we aim to safeguard the success of our company in the
long term and generate additional value. Bayer's reorganization was a key
requirement for this significant step. Equally, we will be safeguarding the
future of our chemicals business because, as an independent company, NewCo will
be able to respond faster and more flexibly. In this new scenario, chemicals
and polymers will be the core businesses and therefore the top priorities of
the company's new management team."

In the future Bayer aims to concentrate all its financial and management
resources on developing and expanding its core activities in health care,
nutrition and innovative materials, which are predominantly research-intensive
areas. Wenning sees high growth potential in these areas but also a
corresponding need for investment. "This means we do not have sufficient
resources available to maintain or enhance the market positions of our
chemicals business or all of our polymers activities," said Bayer's CEO. The
separation should trigger the necessary entrepreneurial impulses and create the
conditions for optimizing the strategies of each company according to their
different business needs.

Bayer's wealth of knowledge with respect to humans, animals, plants and
materials, coupled with the respective products, will provide the foundation
for sustainable growth in the long term in the promising markets in which Bayer
plans to specialize. Following the reorganization, Bayer will have three
operating subgroups: Bayer HealthCare, Bayer CropScience and Bayer

Growth will come primarily from products containing newly researched active
ingredients, from the consumer healthcare business and from growth in Asia.
However, contributions to value creation should be achieved by the Group-wide
utilization of technology platforms, nanotechnology and the expansion of
biotechnology and genetic engineering as key innovation drivers.

Biotechnology is used not only by CropScience to achieve sustainable
qualitative improvements in food crops and higher yields, but also to open up a
range of new applications in other areas such as gene-based diagnostics.

Bayer's new realignment also includes repositioning the Pharmaceuticals
business. "We have examined all the options for this business - especially the
possibility of partnerships. We found that none of these solutions would have
adequately reflected the value of our Pharmaceuticals business. In our view,
they would not have offered a value-creating alternative," explained Werner
Wenning. "We therefore intend to focus on our own strengths and steer our
Pharmaceuticals Division with significantly modified structures towards a
successful future." Bayer will concentrate its research effort on the
therapeutic areas where it already plays a leading role and has developed
successful products: anti-infectives, cardiovascular (including diabetes and
obesity) and urology. Bayer also has a number of promising product developments
in the oncology (cancer) field.

"We intend to position our Pharmaceuticals Division as a mid-size European
pharmaceuticals business because we are convinced that this will generate the
greatest value for our shareholders," stated Wenning. In the future, the
division's activities will be focused more strongly on Europe, though without
neglecting the important markets in the United States and Asia. According to
Wenning, considerable progress has already been made in restructuring
Pharmaceuticals. Successful new product launches have given grounds for
optimism. For example, sales of Levitra®, Bayer's treatment for erectile
dysfunction, are very encouraging. Also, major progress has been made in the
area of cancer research. A raf kinase inhibitor for the treatment of advanced
renal cell carcinoma, developed in collaboration with U.S. company Onyx, has
now entered phase III clinical trials.

Wenning also sees particular opportunities for growth in the consumer
healthcare business. Bayer's Consumer Care, Diagnostics and Animal Health
divisions hold strong or very strong positions worldwide. The company intends
to further expand these activities.

The CropScience business units Herbicides, Insecticides, Fungicides and Seed
Treatment hold excellent positions, and the aim is to grow faster than the
market in these areas. Environmental Science is the market leader in the supply
of pest control products for the home and garden. The Bio Science unit is a
pool of impressive expertise in the field of biotechnology for which experts
predict annual growth rates of 15 percent.

In MaterialScience, Bayer holds global leadership positions in polyurethanes,
polycarbonates and coating raw materials. It has access to internationally
acknowledged leading-edge technologies and a wealth of expertise acquired over
many years. It is intended to continue expanding the growth areas of innovative
plastics and coatings materials - with a special investment focus on the growth
markets of Asia. In China alone, Bayer is currently building or planning
several new production facilities. The MaterialScience subgroup will in future
also include the subsidiaries H.C. Starck and Wolff Walsrode.

In addition to these three operating subgroups, the three service companies
will also remain within the Bayer Group. These companies will also perform
services for NewCo. Employees of the service companies whose work centers on
areas that will be part of NewCo are to be transferred to NewCo.

With sales of EUR 5.6 billion and a workforce of around 20,000, NewCo will rank
among Europe's leading chemicals suppliers, occupy leadership positions in more
than two thirds of global market segments and be a technology leader in
manufacturing. "Independence will trigger strong entrepreneurial impulses,
enabling NewCo to enhance the competitiveness of its production technology,
too, and generate above-average growth and value," said Wenning.

Independence from Bayer should put NewCo in a position to utilize capital
resources more efficiently for the enhancement of its competitiveness and to
seek partners or investors at its discretion. The new structure will also make
it easier to focus management resources on the specific needs of the chemicals
business, conform structures and processes to the requirements of the chemical
industry and activate niche markets utilizing new business models. The aim is
to continue to grow through a stronger focus on innovation, efficient use of
resources and targeted expansion of attractive specialty applications.

NewCo will have a broad-based portfolio of around 5,000 products covering
basic, specialty and fine chemicals as well as polymers. These products
include: intermediates for the manufacture of active ingredients for
pharmaceuticals and crop protection products; material protection products;
chemicals for the leather, textile and paper industries; ion exchange resins
for water treatment applications; inorganic pigments for coloring concrete and
plastics; polymer additives such as flame-retarding agents and plasticizers;
solid rubber and rubber chemicals for the rubber and tire industries; ABS
(styrenics) and semi-crystalline thermoplastics which are used primarily in
automotive engineering, as well as for the manufacture of covers and housings.
NewCo will have a global presence with production facilities and sales
organizations in 40 companies and 20 countries.

Forward-looking statements<br/>:
This news release contains forward-looking statements based on current
assumptions and forecasts made by Bayer Group management. Various known and
unknown risks, uncertainties and other factors could lead to material
differences between the actual future results, financial situation, development
or performance of the company and the estimates given here. These factors
include those discussed in our public reports filed with the Frankfurt Stock
Exchange and with the U.S. Securities and Exchange Commission (including our
Form 20-F). The company assumes no liability whatsoever to update these
forward-looking statements or to conform them to future events or developments.