Elanco Animal Health to cut 900 jobs in 40 countries in restructuring following acquisition of Bayer Animal Health

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Elanco Animal Health Inc. said Wednesday it is restructuring its business just two months after closing the acquisition of Bayer Animal Health. The Greenfield, Indiana-based company said it expects to cut 900 jobs across nearly 40 countries, mostly in sales and marketing, but also in R&D, manufacturing and quality, and back office support. The company is aiming to generate at least $100 million in annual savings, and will start to de-lever, by paying $100 million on its term loan. Elanco is aiming to capture initial synergies from the deal, despite the challenges presented by the coronavirus pandemic. “After our early view of the combined business, we have full confidence in delivering $275 million to $300 million in synergies, with the first two-thirds coming in the first 30 months,” Chief Executive Jeff Simmons said in a statement. The restructuring is expected to cost $190 million to $210 million, and the company will book a restructuring charge of $130 million to $145 million in the third quarter, followed by $40 million to $45 million in the fourth quarter. Shares were not active premarket, but have fallen 9% in the year to date, while the S&P 500 has gained 3.2%.
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