Related Parties

Related parties as defined in IAS 24 are those legal entities and natural persons that are able to exert influence on Bayer AG and its subsidiaries or over which Bayer AG or its subsidiaries exercise control or joint control or have a significant influence. They include, in particular, nonconsolidated subsidiaries, joint ventures and associates included in the consolidated financial statements at fair value or using the equity method, and post-employment benefit plans. Related parties also include the corporate officers of Bayer AG whose compensation is reported in Note “Total compensation of the Board of Management and the Supervisory Board, advances and loans” and in the Compensation Report, which forms part of the Combined Management Report.

Intercompany profits and losses for companies accounted for in the consolidated financial statements using the equity method were immaterial in 2018 and 2017.

Covestro ceased to be recognized as an associate in May 2018. Receivables and liabilities from associates therefore declined.

In May 2018, Bayer AG acquired 6.8% of Covestro shares from Bayer Pension Trust e. V. at market value for a total amount of €1.1 billion to service the exchangeable bond that matures in 2020. As a result of the stock buyback program implemented by Covestro AG, we held 7.5% of shares in that company as of December 31, 2018.

Bayer AG has undertaken to provide jouissance right capital (Genussrechtskapital) in the form of an interest-bearing loan with a nominal volume of €150 million (2017: €150 million) for Bayer-Pensionskasse VVaG. The entire amount remained drawn as of December 31, 2018. The carrying amount was €152 million (2017: €152 million). Loan capital was first provided to Bayer-Pensionskasse VVaG in 2008 for its effective initial fund. This capital had a nominal volume of €635 million as of December 31, 2018 (2017: €595 million). The carrying amount was €643 million (2017: €605 million). The outstanding receivables, comprised of different tranches, are each subject to a five-year interest-rate adjustment mechanism. Interest income of €16 million (2017: €15 million) and expenses of €8 million due to fair value changes were recognized for 2018.

As in the prior year, we did not recognize any material impairment losses on receivables from associates in 2018.

Compare to Last Year