Monsanto has finally agreed to be purchased by Bayer AG in a historic $66 billion all-cash takeover. The agreement, which both corporations have confirmed, will form the largest seed and pesticide company in the world.
Lorraine Chow reports for Eco-Watch:
The German pharmaceuticals and chemicals giant had been courting the St. Louis-based seed maker for roughly four months, with the aspirin-maker sweetening the pot with ever-growing sums of money. Bayer finally plans to pay $128 a share for Monsanto, up from its initial May offer of $122 a share.
Not only is this the largest foreign corporate takeover ever by a German firm, it's the largest cash bid on record, as Reuters reported. A successful merger would create the world's largest agrichemical firm, which will control more than one-fourth of the combined global market for seeds and pesticides.
According to Bloomberg, "The deal gives Bayer more than 2,000 varieties of seeds for crops such as corn, soybeans, and wheat. Adding that portfolio to its own vegetable, rice, cotton and oilseed offerings give Bayer a virtually unassailable position at the head of the market."
The Monsanto-Bayer combination is yet another example of the rapidly consolidating agricultural industry, with only a handful of companies controlling the sector. Alongside slumping crop prices, DuPont Co. and Dow Chemical Co. have agreed to merge, as did China National Chemical Corp. and Syngenta AG.
Bayer CEO Werner Baumann and Monsanto Chairman and CEO Hugh Grant, appeared in a joint announcement of the proposed combination on their "Advancing Together" website. In their statements, both chiefs echoed Big Ag's oft-repeated sentiment that biotechnology helps increases crop yields in an environmentally friendly way and is one solution to feeding a growing global population.
"We are fully committed to helping solve one of the biggest challenges of society, and that is how to feed a massively growing world population in an environmentally sustainable manner," Baumann said.
"What we do is good for consumers. We help produce efficient, safe, healthy and affordable food. It is also good for our growers because they have better choices to increase yields in a sustainable way."
Dave Murphy, the executive director of Food Democracy Now!, refutes this belief. "Agricultural biotechnology has never been about 'feeding the world,' but enriching the bottom line of toxic chemical corporations that have had a long history of producing chemicals that are deadly to human populations and the environment," he told EcoWatch.
Monsanto, the world's largest producer of genetically modified (GMO) crops and maker of the glyphosate-based herbicide Roundup, has faced mounting controversy and numerous lawsuits in recent years over the health and environmental impacts of its products.
Bayer has also been subject to criticism over its widely used insecticide, imidacloprid, which belongs to a controversial class of chemicals called neonicotinoids that's linked to widespread deaths of pollinators.
On today's landmark news, Murphy said: "Now the most evil company in Europe has absorbed the most evil company in America. Monsanto and Bayer's new corporate motto should be 'Killing bees and butterflies for fun and profit.'"
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