This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/news/business-36356022
The article has changed 4 times. There is an RSS feed of changes available.
Version 1 | Version 2 |
---|---|
Bayer's Monsanto bid to create biggest agricultural supplier | Bayer's Monsanto bid to create biggest agricultural supplier |
(about 1 hour later) | |
German drugs giant Bayer has made a $62bn (£43bn) offer for Monsanto, in a deal that would create the world's biggest agricultural supplier. | |
Bayer said the bid was an "extraordinary opportunity to create a global agriculture leader." | 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. |
Last week, news of the deal angered Bayer investors, with one describing it as "arrogant empire-building". | |
Bayer's farm business produces seeds as well as compounds to kill weeds, bugs and fungus, but it is better known for its healthcare products such as Asprin and Alka-Seltzer. | |
Analysts said if the deal went through, almost half of the merged firms' business would be agriculture, a mix likely to displease investors who had bought shares in Bayer for its pharmaceutical offering. | |
Bayer's shares, which fell 8% when the merger talks were announced last week, fell 3% in early trading. | |
The offer comes amid a wave of mergers in the industry. | The offer comes amid a wave of mergers in the industry. |
'Perfect match' | |
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. |
The drop in commodity prices has put pressure on firms such as Monsanto, with farmers' cutting orders for supplies. | |
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. |
"Monsanto is a perfect match to our agricultural business. We would combine complementary skills with minimal geographic overlap. | |
"At the same time, ongoing consolidation activities in the industry make this combination by far the most attractive one," Bayer's chief executive Werner Baumann said in a statement. | |
He said he was confident that the Monsanto board would accept the offer, saying "we fully expect a positive answer". | |
Both companies had confirmed last week that they were in talks over a possible deal. | |
Industry mergers | Industry mergers |
Bayer 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. |
After the unsuccessful bid, Monsanto announced plans to cut 3,600 jobs by the end of next year in a massive restructuring. | |
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. |