Elanco's Brazil unit taps new executive as $6.89 billion Bayer deal concluded

SAO PAULO (Reuters) - Sérgio Schuler was appointed director general of Elanco Animal Health Inc's ELAN.N Brazil unit after the U.S.-based veterinary products firm completed its acquisition of Bayer's BAYGn.DE animal health division on Monday.

Schuler, who worked as director of Bayer’s animal health division in Brazil for seven years, is taking over from Carlos Kuada, who was tapped as Elanco’s senior commercial vice president in Latin America, according to a statement.

Elanco’s acquisition of Bayer’s animal health division, announced last August, created the world’s second largest company in the sector and was valued at $6.89 billion. In Brazil, where the domestic livestock industry is booming, Elanco will rank third after the Bayer deal, with pro forma net sales of about $150 million annually.

“Every fifth chicken in the world is produced in Brazil,” Schuler told Reuters in an interview. “Brazil is a key market.”

The combined companies will leverage Elanco’s strength in supplying veterinary products to farm animals with Bayer’s leading position in the pet market.

Jeff Simmons, president and chief executive of Elanco, said in a statement that combining Elanco and Bayer into a stand-alone animal health firm was challenging, citing “the century’s most significant animal and human health pandemics: African Swine Fever (ASF) and COVID-19.”

But ASF, which is deadly for pigs but harmless to humans, drove a rise in Brazilian meat sales to China, after it had to cull millions of sick hogs and increase meat imports.

Meanwhile Brazilian pork and chicken exports and production are projected to increase in 2020 as local meat-packers have continued to operate during the COVID-19 pandemic.

“We are in the food production chain, especially in Brazil,” said Kuada in the same interview with Schuler. “While people eat eggs, dairy, cheese and chicken, our business will be stable.”

Reporting by Ana Mano; editing by Jonathan Oatis