German-based Bayer, known to US consumers for introducing aspirin more than a century ago, made three other buyout offers before Monsanto accepted an all-cash deal, the largest this year and the biggest foreign takeover of a USA corporation, according to DealLogic.
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Bayer later sweetened its bid, raising its offer incrementally until agreeing to the deal at $128 per share. It first offered $122 per share, which was subsequently raised to $125 per share and $127.50.
He says the deal is expected to be completed by the end of 2017.
The Monsanto name may go away as the seeds and traits business becomes just one division of a giant conglomerate that also makes pharmaceuticals and other health-care products. The Bangkok Post reported that analyst Peter Spengler with DZ bank was skeptical of the deal even before it was announced on Wednesday, writing, “We do not like this transaction because we think that Bayer is overpaying significantly”.
Bayer’s move to combine its crop chemicals business, the world’s second largest after Syngenta AG, with Monsanto’s industry leading seeds business, is the latest in a series of major tie-ups in the agrochemicals sector. For example, a merger between DuPont and Dow Chemical that was agreed upon in December of a year ago is unlikely to close until early 2017 after the European Commission started an investigation.
Germany-based life science company Bayer (BAYRY) and USA seed giant Monsanto (MON) announced a merger agreement on Tuesday morning worth $66 billion.
The proverb “if at first you don’t succeed, try, try again” is certainly on point when it comes to Bayer’s acquisition of Monsanto. Bayer agreed to pay Monsanto a $2 billion fee should the deal fall through.
US chemicals giants Dow Chemical Co and DuPont plan to merge and spin off their seeds and crop chemicals operations into a major agribusiness.
“This represents a major step forward for our crop science business”, Bayer chief executive Werner Baumann said in the statement.
Third time is the charm for Bayer and Monsanto, as the companies announced today that they have finally signed their long-awaited definitive agreement to merge.
The German company agreed to pay about $128 a share and an announcement is planned imminently, said the people, who asked not to be identified because talks are private. “It’s the last big industry in the world to be digitised”, said Fraley.
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But U.S. antitrust enforcers will look at more than product overlaps in assessing the proposed merger, said Moss.
