Chemical and pharmaceuticals giant Bayer AG has said it has made a cash offer for the world’s largest seed maker Monsanto in a deal worth $62 billion (£43bn).
Bayer, which has already significantly increased capacity of its seeds business in recent years, said the move was an opportunity to ’build a leading agricultural player’.
It revealed this morning (May 23) that it was offering $122-a-share for the Missouri-based group, valuing the stock at about $53bn, with debt accounting for a further $9bn.
The transaction would bring together leading Seeds and Traits, Crop Protection, Biologics, and Digital Farming platforms.
Bosses said the combined business would benefit from Monsanto’s leadership in Seeds & Traits and Bayer’s broad Crop Protection product line across a comprehensive range of indications and crops.
Bayer chief executive Werner Baumann said: “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.
“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.”
Last week both companies said they were in talks over a possible deal.
Bayer said the combination would be ‘truly complementary from a geographic perspective’, significantly expanding Bayer’s long-standing presence in the Americas and its position in Europe and Asia/Pacific.
Liam Condon, member of the board of management of Bayer AG and head of the Crop Science division, said customers of both companies would benefit from the broad product portfolio and the deep R&D pipeline.
“Bayer is committed to enabling farmers to sustainably produce enough healthy, safe and affordable food capable of feeding the world’s growing population,” said Mr Condon.
“Faced with the complex challenge of operating in a resource-constrained world with increasing climate volatility, there is a clear need for more innovative solutions that advance the next generation of farming.
“By supporting farmers of all sizes on every continent, the combined business would be positioned as the partner of choice for truly integrated, superior solutions.”