Germany’s Bayer offers $62bn to acquire US Monsanto

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SINGAPORE (ICIS)–Germany’s Bayer said on Monday it has offered about $62bn to acquire US agrochemicals and seeds major Monsanto at $122 per share in all-cash bid.

“Bayer has made an all-cash offer to acquire all of the issued and outstanding shares of common stock of Monsanto Company for $122 per share or an aggregate value of $62 billion,” it said in a statement.

The acquisition will make Bayer the world’s biggest seed supplier and a pioneer of crop biotechnology.

“Bayer expects annual earnings contributions from total synergies of approximately $1.5 billion after year three plus additional integrated offer benefits in future years,” the statement added.

Bayer said the written offer proposed to Monsanto dated 10 May represents a substantial premium of 37% over Monsanto’s closing share price of $89.03 as on 9 May 2016 and 36% over the three-month volume weighted average share price.

“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,” said Werner Baumann, CEO of Bayer AG.

Bayer said that it was publicly disclosing the contents of its private proposal to acquire Monsanto in response to market speculation and stakeholder inquiries.

The statement said Bayer’s Board of Management and Supervisory Board unanimously approved the proposal and are fully committed to pursuing the transaction.

“Bayer is prepared to proceed immediately to due diligence and negotiations and to quickly agree to a transaction. The transaction will be subject to customary closing conditions.”

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