Bayer AG said on Tuesday it would cooperate fully with an investigation over price fixing by chemical makers that Wall Street Journal reported had widened into a global probe and also involved Dow Chemical Co and DuPont.
The Journal reported that U.S. and European investigators were looking into allegations of price fixing in half a dozen chemicals used in plastics, rubber and synthetic materials in the United States, Canada, Europe and Japan.
It said this represented a widening of a two-year-old investigation into price fixing in the chemical industry.
Bayer did not comment on the specifics of the report but said it was cooperating with the authorities.
"This is not a new development. It's based on allegations of cartel activities in certain rubber-related lines of business and has involved Bayer since the fall of 2002. We are fully cooperating with the authorities," a Bayer spokesman said.
He said he did not want to comment on specifics due to ongoing proceedings.
Sven Dopke, an analyst at M.M. Warburg, said in a note that Bayer had built financial provisions for the investigations in 2003. "We estimate a coverage of up to 110 million euros," he wrote.
Dow Chemical and DuPont representatives were not immediately available for comment on the newspaper report, which said at least four grand-jury investigations stemming from the probes were under way in San Francisco.
Among the latest products under scrutiny are a widely used plastic, urethane, and a synthetic rubber known as neoprene, the newspaper cited lawyers close to the case as saying.
The newspaper said the widened probe was spurred by a case involving chemical maker Crompton Corp. In March, Crompton pleaded guilty to price fixing in the rubber chemicals market and agreed to pay a $50 million U.S. fine and cooperate with government investigators.
The widened investigation has been aided by prosecutors' use of amnesty grants for whistle blowers, the newspaper said.
Crompton and Bayer have applied for amnesty and are cooperating with investigators, while Dow and DuPont have disclosed that they too are cooperating with federal officials, the newspaper said.
