Ending weeks of speculation about the company's future, BAYER AG (Leverkusen, Germany) announced late last week that it will hive off its pharmaceuticals and crop protection businesses into separate units.

Bayer's business model has been built on a four-pillar strategy - healthcare, chemicals, crop protection and polymers. In the past year, however, the company has come under increasing pressure from analysts and a minority of shareholders to split itself into two or more parts to unleash the greater growth potential of its pharmaceuticals unit.

Calls for the company to consider selling its drug unit became more pronounced recently following the company's withdrawal of Baycol, its most lucrative drug. Bayer pulled the cholesterol-lowering drug in August after the FDA linked it to 31 deaths, as reported by Medical Industry Today.

Bayer officials say they remain committed to the four-pillar concept, but that it's necessary to separate the pharmaceuticals unit to achieve "greater flexibility for necessary strategic partnerships."

"We have to set a new course, but we still need more time to work out a detailed timetable," Manfred Schneider, Bayer management chairman, said in a statement.

In other company restructuring developments, Bayer said it intends to complete its acquisition of Aventis CropScience by the end of September. Bayer is acquiring the CropScience unit for about $5 billion in a move that would essentially double its crop protection business. The company also has announced it intends to reduce its global work force by 4,000, with most of the cuts coming in the chemicals and healthcare segments.

In a separate development, the company announced that Werner Wenning, the company's 54-year-old chief financial officer, will succeed Schneider as the company's new chairman.