Bayer acquires Monsanto in largest-ever deal by a German company

pharmafile | September 14, 2016 | News story | Business Services, Manufacturing and Production, Sales and Marketing Bayer, acqusition, monsanto 

Bayer and Monsanto have signed a definitive merger agreement under which the German drugmaker will acquire the US agricultural group after weeks and months of relentless negotiations. The deal is the biggest this year and the largest-ever acquisition by a German pharma firm.

The final valuation of the acquisition stood at $128 per share in an all-cash transaction, with Monsanto’s board of directors, Bayer’s board of management and Bayer’s supervisory board all in unanimous agreement. The offer represents a premium of 44% of Monsanto’s closing share price on May 9, 2016 – one day before Bayer’s first written proposal to the group.

“We are pleased to announce the combination of our two great organisations,” remarked Werner Baumann, CEO of Bayer AG. “This represents a major step forward for our Crop Science business and reinforces Bayer’s leadership position as a global innovation driven Life Science company with leadership positions in its core segments, delivering substantial value to shareholders, our customers, employees and society at large.”

The story of the acquisition has been decorated with a number of tenacious bids, beginning with an original rejected total valuation of $62 billion in May and leading up to a $65.5 billion offer this morning. Reports indicated earlier this week that the firm was even looking into a $1.1 billion sale of its dermatology unit to fund the merger.

Hugh Grant, chairman and CEO of Monsanto added: “Today’s announcement is a testament to everything we’ve achieved and the value that we have created for our stakeholders at Monsanto. We believe that this combination with Bayer represents the most compelling value for our shareowners, with the most certainty through the all-cash consideration.”

“We are entering a new era in agriculture – one with significant challenges that demand new, sustainable solutions and technologies to enable growers to produce more with less,” he continued. “This combination with Bayer will deliver just that – an innovation engine that pairs Bayer’s crop protection portfolio with our world-class seeds and traits and digital agriculture tools to help growers overcome the obstacles of tomorrow. Together Monsanto and Bayer will build on our proud tradition and respective track records of innovation in the agriculture industry, delivering a more comprehensive and broader set of solutions to growers.”

Matt Fellows

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