Bayer plans completion of Monsanto acquisition
4th June 2018
Bayer plans to complete the acquisition of Monsanto on 7th June, following the receipt of all required approvals from regulatory authorities, says the company. “The acquisition of Monsanto is a
Bayer plans to complete the acquisition of Monsanto on 7th June, following the receipt of all required approvals from regulatory authorities, says the company. “The acquisition of Monsanto is a strategic milestone in strengthening our portfolio of leading businesses in health and nutrition. We will double the size of our agriculture business and create a leading innovation engine in agriculture, positioning us to better serve our customers and unlock the long-term growth potential in the sector,” said Werner Baumann, Chairman of the Board of Management of Bayer AG.
Bayer announced its intention to acquire Monsanto in May 2016 and signed an agreement with the US company for 128 US dollars per share in September 2016. Currently that corresponds to a total cost of approximately 63 billion US dollars taking into account Monsanto’s debt outstanding as of February 28, 2018. In connection with the comprehensive regulatory approval process, Bayer has agreed to the divestiture of businesses which generated 2.2 billion euros in sales in 2017 for an aggregate base purchase price of 7.6 billion euros.
Including Monsanto and taking the divestitures into account, the agriculture businesses would have been roughly equal in size in 2017, with total pro forma sales of around 45 billion euros including combined Crop Science sales of around 20 billion euros. In 2017, both companies together employed approximately 115,000 people, accounting for the divestments.
Bayer will become the sole shareholder of Monsanto on the 7th June. According to the conditional approval from the United States Department of Justice, the integration of Monsanto into Bayer can take place as soon as the divestments to BASF have been completed. This is expected to be in approximately two months. “We have diligently prepared for the upcoming integration over the past two years. Our extensive experience in integrating other large companies has proven that we can and will be successful,” said Baumann.
Bayer will remain the company name and Monsanto will no longer be a company name. The acquired products will retain their brand names and become part of the Bayer portfolio, pointed out the company.