Bayer completes acquisition of Monsanto
German life sciences company Bayer has completed the $66 billion buyout of agricultural corporation Monsanto, a week after the US government announced Bayer must divest $9 billion worth of assets for the deal to proceed.
Today, June 7, the companies both released statements ( here and here) announcing the deal’s completion. Bayer can integrate Monsanto into the company only after the German business has divested assets to BASF, as required by the US Department of Justice (DoJ).
The DoJ said on May 29 that Bayer must divest its crop protection business and assets to chemical company BASF, which also has a crop protection business, in order to preserve competition in the market.
Both Bayer and Monsanto have developed technologies that have allowed farmers to increase crop yields and improve efficiency so, without the DoJ’s required divestiture, the proposed merger could result in higher prices, lower quality seed and crop protection products, and fewer choices for products, the government said.
The merger divestiture represents the largest ever required by the US. The companies said that the divestment process is likely to begin in two months.
Bayer is now the sole owner of Monsanto, and shares in the US company will no longer be traded on the New York Stock Exchange.
Werner Baumann, chairman of the Bayer board, said it is a “great day” for farmers around the world, “whom we will be able to help secure and improve their harvests even better”, and for consumers and broader society, “because we will be even better placed to help the world’s farmers grow more healthy and affordable food in a sustainable manner”.
Hugh Grant, outgoing chairman and CEO of Monsanto, added that the deal represents an important milestone towards the vision of creating a leading agricultural company, “supporting growers in their efforts to be more productive and sustainable for the benefit of our planet and consumers”.
The deal, which represents the largest in Bayer’s history, has been approved in other major markets including the EU. In March this year, the European Commission approved the acquisition but required Bayer to divest its entire vegetable seed business, and research and development organisation.
Monsanto CEO Grant previously announced that he would leave the company after the acquisition had closed.
Did you enjoy reading this story? Sign up to our free daily newsletters and get stories sent like this straight to your inbox.
