Bayer subsidiary raises 1.5 bn after delayed IPO over VW crisis

Covestro, the polymers business of German pharmaceuticals giant Bayer, successfully raised 1.5 billion euros from the market Tuesday, after scaling down the flotation due to volatility triggered by the massive Volkswagen pollution-cheating scam.

The subsidiary had originally planned to price the shares somewhere between 26.50 and 35.50 euros, which would have raised up to 2.5 billion euros ($2.8 billion) in all.

But the price target was later scaled back to a range of 21.50-24.50 euros.

On Tuesday, the stock fetched 26 euros on its debut on the regulated market segment of the Frankfurt stock exchange.

Covestro intends to use the proceeds from the IPO primarily to repay intercompany debt to Bayer.

Covestro chief executive Patrick Thomas said the flotation puts the company "in an even better position than before, enabling us to build on our strengths in the global competitive arena.

"We intend to share our business success with our investors and will therefore pay them a dividend from the start," he added.