FRANKFURT-German pharmaceutical and chemicals giant Bayer AG on Monday said its bid to acquire US agrochemicals company Monsanto Co. was an all-cash offer valued at $62 billion.
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Bayer said the offer of $122 per share represented a 37% premium on the price of Monsanto shares before rumours about the takeover bid emerged in the media.
John Bennett, fund manager at Henderson Global Investors, Bayer’s 15th biggest investor by company, says Bayer CEO Werner Baumann had only been on the job for weeks and had presided over an “immediate destruction” of shareholder value.
The acquisition would create the world’s largest agricultural supplier.
The US group has a market value of $42bn (£28.6bn), but any deal if agreed is likely to be higher.
Bayer’s Board of Management and Supervisory Board unanimously approved the proposal and are fully committed to pursuing the transaction.
Monsanto is headquartered in St. Louis, Missouri.
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“Folding Monsanto’s world-leading seed franchise and its trademark Roundup herbicide business into Bayer would create a company that could market products ranging from Aspirin pain-relief pills to crop genetics that enable plants to withstand bugs and weedkillers. That left the other major global seed and pesticide players-Monsanto, Bayer and BASF SE-to potentially face enlarged rivals, and entertain a narrower range of potential partners”.
