Multi billion dollar deal to create mega agrochemical company moves closer
The shareholders of Monsanto have approved a $66 billion takeover by Bayer AG.
Under the terms of the merger agreement, Monsanto shareowners will receive $128 per share in cash at the closing of the merger.
The deal still requires regulatory approval which is expected to close in late 2017.
It has been reported that if the deal closes, it will create a company commanding more than a quarter of the combined world market for seeds and pesticides.
The acquisition came after a string of large mergers that have roiled the agribusiness sector in the last year or so, including ChemChina's purchase of Swiss chemicals company Syngenta AG (SYNN.S) and a merger of Dow Chemical and DuPont.
Hugh Grant, Monsanto Chairman and Chief Executive Officer said he is pleased the company received such strong support from our shareowners.
“This is an important milestone as we work to combine our two complementary companies and deliver on our shared vision for the future of agriculture.
Meanwhile, Werner Baumann CEO of Bayer AG said the acquisition of Monsanto is driven by its strong belief that this combination can help address the growing challenges facing farmers and the overall agriculture industry today and in the future.
“Together, Bayer and Monsanto will be able to offer the new, innovative solutions that our customers need. We look forward to completing the transaction and working closely with Monsanto to ensure a successful integration.”
However, the deal has been criticised in some quarters, with the President of the US National Farmers Union Roger Johnson saying recently that consolidation of this magnitude cannot be the standard for agriculture, nor should we allow it to determine the landscape for our future.
“The merger between Bayer and Monsanto marks the fifth major deal in agriculture in the last year, preceded by an approval of the Syngenta/ChemChina acquisition and proposed mergers between Dow/DuPont, Potash Corp./Agrium and John Deere/Precision Planting LLC.
“We will continue to express concern that these megadeals are being made to benefit the corporate boardrooms at the expense of family farmers, ranchers, consumers and rural economies.
“We underscore the importance that all mergers, including this recent Bayer/Monsanto deal, be put under the magnifying glass of the committee and the U.S. Department of Justice,” he said.
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