Bayer, Monsanto sign merger agreement

.Bayer will acquire St. Louis-based company for $128 share in all-cash transaction.

Bayer and Monsanto announced they signed a merger agreement under which Bayer will acquire Monsanto for $128 per share in an all-cash transaction. The total value of the deal is around $66 billion, making it the largest merger of 2016 so far.  

Monsanto’s board of directors, Bayer’s board of management and Bayer’s supervisory board have unanimously approved the agreement. Based on Monsanto’s closing share price on May 9, 2016, the day before Bayer’s first written proposal to Monsanto, the offer represents a premium of 44 percent to that price.

“We are pleased to announce the combination of our two great organizations,” Bayer AG CEO Werner Baumann said. “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 deal would create a company commanding more than a quarter of the combined world market for seeds and pesticides in the fast-consolidating farm supplies industry. The deal follows the Syngenta-ChemChina and Dow-DuPont mergers announced earlier this year. 

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

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