Bayer Monsanto Merger Confirmed – $66 Billion Dollar Acquisition
It happened … Bayer has wedded Monsanto this past Wednesday.
Previously, we reported that Bayer AG – one of the world’s largest crop chemicals business, second only to Syngenta – was out to acquire or “merge” with Monsanto – the multinational seed and biotech corporation – in one of the biggest mergers in recent history. In fact, the all-cash deal has now created the world’s largest supplier of seeds and agricultural chemicals and the biggest German/American transaction to date.
Bayer then wooed Monsanto by offering more money per share, upping the ante, and $4 billion more than the initial offer. Monsanto did an about-face and quickly pulled out of an Indian GM cotton imitative. Also this week, Monsanto abandoned its share in seed breeding company InterGrain which had a genetically engineered drought-tolerant wheat in development. This unloading was conveniently subsidized by the West Australian government, and some think Monsanto made this recent move to sweeten the deal for Bayer Ag.
Monsanto made the following announcement:
“Bayer and Monsanto to Create a Global Leader in Agriculture”
Bayer and Monsanto today announced that they signed a definitive merger agreement under which Bayer will acquire Monsanto for USD 128 per share in an all-cash transaction. Monsanto’s Board of Directors, Bayer’s Board of Management and Bayer’s Supervisory Board have unanimously approved the agreement. Based on Monsanto’s closing share price on May 9, 2016, the day before Bayer’s first written proposal to Monsanto, the offer represents a premium of 44 percent to that price.
The aggregate value of the merger/acquisition is the symbolically significant number of $66 billion dollars with expected annual synergies of approximately USD 1.5 billion after three years. Monsanto says the merger “brings together two different, but highly complementary businesses.”
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