Bayer and Monsanto say St. Louis will remain prominent in combined company

Monsanto – the company that has often been at the center of controversiesregarding genetically modified organisms, pesticides, and industrial chemicals – has agreed to be acquired by Bayer, a German agrochemicals firm known best for making drugs like Alka-Seltzer and Aspirin, the companies announced Wednesday.

Baumann said, “Looking ahead to our future as a combined company, we plan for the global Seeds and Traits and North American commercial headquarters to be in St. Louis, Missouri, the global Crop Protection and overall Crop Science headquarters in Monheim, Germany, and an important presence in Durham, North Carolina, as well as many other locations throughout the USA, and around the world”. Scientists at Monsanto have added genes to seeds that let crops resist numerous natural forces that kept farming at the mercy of nature for millennia, achieving such exotic functions as fending off insects, surviving toxic herbicides or drought conditions-or even yielding oils with less saturated fat. As the Two-Way has reported, “the company is a German pharmaceutical and chemical powerhouse with 102,000 employees and $41 billion in revenue past year”. Monsanto’s sales totalled US$15 billion (20.5b) a year ago.

After four months of courtship, Leverkusen, Germany-based Bayer AG said Monsanto Co. accepted its third offer.

“With respect to any merger and acquisition affecting soybean farmers, ASA is concerned primarily with how these affect the farm input costs of farmers, as well as how they impact innovation, research and competition in the marketplace, said ASA president Richard Wilkins, a soybean farmer from Greenwood, Delaware, in a media statement”. The companies “have chosen to do a deal in the year of merging dangerously”.

“Farmers tend to believe they are better served by a lot of small players competing against each other”, Robb Fraley, chief technology officer at Monsanto, said in an interview a few weeks before the announcement.

“We submitted testimony in a letter against the Dow-DuPont merger and we submitted information to the Senate on the Syngenta-ChemChina merger”, Clark says. Valued at $66 billion with the assumption of debt, the deal represents a 44% premium to what Monsanto fetched at the close of trading May 9, the day before Bayer made its first formal offer. Grant also emphasized that the complementary portfolios may also help the deal jump through regulatory hurdles. Monsanto’s shares floated around $107 Wednesday.

“For the last several days our family farm and ranch members have been on Capitol Hill asking Members of Congress to conduct hearings to review the staggering amount of pending merger deals in agriculture today”, Johnson said. Bayer has committed to paying a US$2 billion antitrust breakup fee if the deal falls apart.

The two companies have little product overlap, but regulators might still be wary of the purchase, based on the combined control the company would have over agricultural products.

The proposed combination of Bayer and Monsanto would create a seed and crop-chemical giant with about $26 billion in sales.

Then again, Europe, where Bayer is headquartered, certainlyis more restrictive than the US when it comes to GMOs.

The companies also said they plan to file with the Committee on Foreign Investment in the U.S., which reviews foreign acquisitions of United States businesses. Get twice-daily updates on what the St. Louis business community is talking about.