Bayer buy Monsanto in $66 billion deal

Bayer to buy Monsanto in $66 billion deal

2:55 PM, 14th September 2016
Bayer to buy Monsanto in $66 billion deal
Bayer headquarters in Leverkusen, Germany. (File Photo)

ATLANTA, US: Now it's official: Monsanto is going to be swallowed up by a rival in the biggest takeover announced so far this year. 

To clinch a deal, Germany’s Bayer pumped even more money into its bid for the US seed giant, valuing it at $66 billion, including debt.

It’s the third time Bayer (BAYRY) has cranked up its offer, and this time it was enough to win the backing of Monsanto’s board. The takeover would create a vast conglomerate spanning pharmaceuticals, health products and pesticides.

Announced Wednesday, the bid that sealed the deal is for $128 per Monsanto share, valuing the US company’s equity at about $56 billion. Bayer will also be taking on about $10 billion in debt.

The big obstacle the companies now face is getting the merger past regulators around the globe.

Monsanto shares in the US were flat in premarket trading at around $106. That’s way below the offer price, suggesting investors doubt the deal will go through.

If regulators do kill the transaction, Bayer has agreed to pay $2 billion to Monsanto.

Bayer, which is strongest in Asia and Europe, stands to gain from Monsanto’s expertise in agriculture and seeds. It would also benefit from the US company’s big presence in North America.

Bayer has said combining the companies would generate synergies of $1.5 billion over three years.

The deal is the latest mega-merger aimed at reshaping the agribusiness and chemical sectors.

Another huge tie-up -- the planned $130 billion alliance between Dow and DuPont -- is under investigation by Europe’s top antitrust watchdog.

In February, a giant state-owned Chinese chemical company agreed to pay $43 billion for seed and pesticide firm Syngenta. That deal cleared a major regulatory hurdle in the US last month, but it still has a series of antitrust reviews around the world to get through.

The purchase of Syngenta by ChemChina was the biggest deal announced worldwide this year before Bayer and Monsanto reached agreement. Monsanto had in the past tried unsuccessfully to buy Syngenta.

© CNN (Time Warner Company) News




Your Comments (Up to 2000 characters)
Please respect our community and the integrity of its participants. WOC reserves the right to moderate and approve your comment.

Related News

Linde CEO, CFO to leave following failed merger talks with Praxair

MUNICH, GERMANY: Linde AG said that its chief executive officer (CEO), Dr Wolfgang Buchele and Chief Financial Officer (CFO) Georg Denoke will leave t ...

Read more
Perstorp introduces new thermoplastic material for food packaging

MALMO, SWEDEN: Perstorp Group is now introducing Akestra thermoplastic copolyester to the European market. Akestra is a unique material that offers a ...

Read more
A Schulman retains Citi to assist with business plans

AKRON, US: The board of directors of A Schulman Inc announced that it has retained Citi to assist the company with its previously announced comprehens ...

Read more
Clariant acquires 2 oilfield production chemicals biz in US

MUTTENZ, SWITZERLAND: Clariant International Ltd has acquired two oilfield production chemicals business, Kel-Tech Inc and X-Chem LLC (both located in ...

Read more
BASF again listed in Dow Jones Sustainability Index

LUDWIGSHAFEN, GERMANY: BASF SE has again been included or listed in the Dow Jones Sustainability World Index (DJSI World). This year the company has b ...

Read more
Lonza completes acquisition of nutritional ingredients manufacturer in US

BASEL, SWITZERLAND: Lonza Group said that it has closed the acquisition of InterHealth Nutraceuticals Inc (InterHealth), a leader in research, develop ...

Read more uses cookies to ensure that we give you the best experience on our website. By using this site, you agree to our Privacy Policy and our Terms of Use. X