Bayer's Offer for Monsanto? $62 Billion in Cash

May 23, 2016 06:58 AM

Bayer’s proposal to purchase Monsanto just got some real numbers attached to it.

On Monday, Bayer revealed the details, offering $122 per share in cash to Monsanto shareholders in a deal worth an estimated $62 billion.

“We have long respected Monsanto’s business and share their vision to create an integrated business that we believe is capable of generating substantial value for both companies’ shareholders,” said Werner Baumann, CEO of Bayer AG, in a company statement. “Together we would draw on the collective expertise of both companies to build a leading agriculture player with exceptional innovation capabilities to the benefit of farmers, consumers, our employees and the communities in which we operate.” 


Like other recent seed company deals (Syngenta/ChemChina and Dow/DuPont), Bayer’s acquisition of Monsanto would create a powerhouse seed and crop chemical company, with estimated combined sales of $26 billion in U.S. dollars (or 23.1 billion in euros) in 2015.

That would surpass the other major players, including Syngenta, Dow/DuPont, and BASF. (See chart.)

For many farmers, such consolidation is cause for concern; growers are worried about less competition leading to higher prices for seed and crop chemicals.

In investor and media materials released Monday, Bayer acknowledged those worries, without making any specific promises regarding pricing.  “The idea is about combining two complementary businesses. The relevant markets will continue to be highly competitive. Our goal is to help farmers increase their productivity and profitability, while ensuring an adequate basic supply of healthy, safe and affordable food.”

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Spell Check

AgWeb Editor
Mexico, MO
5/24/2016 07:29 AM

  Some of the comments on this article were deleted because they were not in line with AgWeb’s code of conduct. Comments insulting any person or groups of people are not permitted on this site, and will be removed as they are discovered.

Moorhead, MN
5/23/2016 07:07 PM

  What ever happened to the monopoly laws that are suppose to prevent situations like this?

Dennis Hoyle
Roscoe, SD
5/23/2016 06:45 PM

  I have tried to stay as far away from Monsanto as I can. I thought Bayer was a better option. Now I wonder if this is just a way to make the Monsanto name go away but not the mentality. Maybe it will be an improvement but it seems like too much concentration.


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