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Bayer offers $62bn in Monsanto takeover bid Bayer's Monsanto bid to create biggest agricultural supplier
(35 minutes later)
German drugs and chemicals company Bayer has made a $62bn (£43bn) offer for Monsanto, in a deal that would create the world's biggest agricultural supplier.German drugs and chemicals company Bayer has made a $62bn (£43bn) offer for Monsanto, in a deal that would create the world's biggest agricultural supplier.
Both companies confirmed last week that Bayer had launched an offer for the US seeds giant. Bayer said the bid was an "extraordinary opportunity to create a global agriculture leader."
Monsanto is primarily known for genetically modified crops, often leading to vocal activist criticism.Monsanto is primarily known for genetically modified crops, often leading to vocal activist criticism.
The offer comes amid a wave of mergers in the industry.The offer comes amid a wave of mergers in the industry.
Rivals Dow Chemical, DuPont and Syngenta have all announced tie-ups recently, although they have yet to be cleared by regulators.Rivals Dow Chemical, DuPont and Syngenta have all announced tie-ups recently, although they have yet to be cleared by regulators.
'Arrogant empire-building'
Bayer said the offer of $122 per share represented a 37% premium on the price of Monsanto shares before rumours about the takeover bid emerged in the media.Bayer said the offer of $122 per share represented a 37% premium on the price of Monsanto shares before rumours about the takeover bid emerged in the media.
When news about the takeover offer broke last week, Bayer shares took a 8% hit and a number of large Bayer investors voiced their criticism of the prospective deal. "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," Bayer's chief executive Werner Baumann said in a statement.
Both companies had confirmed last week that they were in talks over the issue.
When news about the takeover offer broke, Bayer shares took an 8% hit and a number of large Bayer investors voiced their criticism of the prospective deal, with one describing it as "arrogant empire-building".
Industry mergersIndustry mergers
The German company has a market value of about $90bn, making it the second-largest producer of crop chemicals after Syngenta.The German company has a market value of about $90bn, making it the second-largest producer of crop chemicals after Syngenta.
Monsanto, which has a market capitalisation of $42bn, attempted to buy Swiss rival Syngenta last year.Monsanto, which has a market capitalisation of $42bn, attempted to buy Swiss rival Syngenta last year.
However, Syngenta ended up accepting a $43bn offer from ChemChina in February, although that deal is still being reviewed by regulators in the US.However, Syngenta ended up accepting a $43bn offer from ChemChina in February, although that deal is still being reviewed by regulators in the US.
Bayer's acquisition of Monsanto is expected to be bigger in value than the ChemChina-Syngenta deal.Bayer's acquisition of Monsanto is expected to be bigger in value than the ChemChina-Syngenta deal.
The biggest merger in the chemicals industry took place late last year when Dow Chemical teamed up with Du Pont to form a new $130bn company.The biggest merger in the chemicals industry took place late last year when Dow Chemical teamed up with Du Pont to form a new $130bn company.