Just four months after finalizing its split with Eli Lilly and Co. (NYSE: LLY), Greenfield-based Elanco Animal Health Inc. (NYSE: ELAN) is reportedly in talks with Germany-based Bayer over a possible merger with its animal health division.
According to Reuters news service, the two companies are working with banks to ensure any merger would receive regulatory approval.
Elanco was part of Lilly for six decades until it was spun off into an independent public company last fall.
Bayer just concluded its purchase of agribusiness giant Monsanto a year ago for $63 billion. Bayer was required to divest of some its properties to assure approval of the Monsanto deal. Reuters says the company is under pressure to divest further assets to raise cash and boost its stock price.
Reuters did not provide a price tag for the deal, but Barron’s financial news estimates the deal could be worth $4.5 billion.
Elanco is the fourth largest company in animal health, primarily in the livestock sector. Bayer ranks fifth in veterinary medicine.