July 14, 2004

Bayer reaches agreement with U.S. Department of Justice in rubber chemicals investigation

- Bayer AG today confirmed that it has reached agreement with the U.S. Department of Justice to settle charges related to allegations that its rubber chemicals business unit engaged in anti-competitive activities between 1995 and 2001. Under the terms of the agreement, Bayer agreed to plead guilty and to pay a fine of $66 million. The company will set up a respective provision for the second quarter of 2004.

Bayer has cooperated with the Department during the investigation. The agreement, which is subject to court approval, is expected to resolve all criminal charges against Bayer in the U.S. for activities related to its rubber chemicals business.

Bayer's clear policy is to comply with antitrust laws and the company will not tolerate violations.

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.