If Monsanto accepts the offer, the German giant in the industry with chemicals and drugs will complement its activities with domination the world market for seeds and agricultural products. Bayer’s offer is 122 dollars per share of Monsanto in cash. On Friday, shares of Monsanto on the stock market ended with a price of 101.52 dollars, which is 37% higher than the price on May 9, the day before Bayer has submitted a written proposal to Monsanto.
Bayer announced that representatives of the management of both sides have met to “discuss privately negotiated takeover.” At the same time, Monsanto said that they are considering the offer of Bayer.
“Monsanto is a great pair for our agricultural business. We would combine complementary experience with minimal geographic overlap. The purchase of Monsanto meets all our requirements for the potential to create value. At the same time, the existing activities of consolidation in the industry make the combination incomparably attractive.”- says Werner Bayman
His expectation is that the transaction would create “significant synergies” and would boost the earnings in the first year after its completion. With the purchase of Monsanto, agricultural products would take about 50% of the future business of his company.
Agriculture business of Bayer produces seeds and tools to destroy weeds, bugs and fungi. Monsanto produces seeds for fruits, vegetables and other crops, as well as chemicals to destroy weeds and protection against bugs.
Monsanto is infamous because of the research and production of GMOs, but despite of all, its seeds are currently covering about 90% of US fields planted with corn, soybeans or cotton.
Bayer has about 117,000 employees around the world. Monsanto has about 20,000.