FRANKFURT, Germany (AP) — German drug and farm chemical company Bayer AG says it has signed a deal to acquire seed and weed-killer company Monsanto for $66 billion in cash.

Bayer says it is paying Monsanto shareholders $128 per share, which represents a 44 percent premium over Monsanto’s closing price on May 9, the day before a proposed deal was announced.

The deal is subject to approval by Monsanto shareholders and anti-trust regulators.

Bayer said Wednesday the transaction brings together two different but complementary companies. Bayer makes a wide range of crop protection chemicals, while Monsanto is known for its seeds business.

Leverkusen-based Bayer said the merged companies’ agriculture business would have its seeds business and North American business headquarters in St. Louis, Missouri, where Monsanto is currently based. </s> FRANKFURT, Germany (AP) — German drug and farm chemical maker Bayer AG says it has agreed to acquire seed and weed-killer company Monsanto in an all-cash deal valued at $66 billion.

Bayer says it is paying Monsanto shareholders $128 per share, which represents a 44 percent premium over Monsanto's closing price on May 9, the day before a proposed deal was announced.

The deal is subject to approval by Monsanto shareholders and anti-trust regulators.

Bayer said Wednesday the transaction brings together two different but complementary companies. Bayer makes a wide range of crop protection chemicals, while Monsanto is known for its seeds business.

Leverkusen-based Bayer said the merged companies' agriculture business would have its seeds business and North American business headquarters in St. Louis, Missouri, where Monsanto is currently based.

Bayer initially offered $122 per share, only to be rebuffed by Monsanto management, and then $125 per share before reaching the deal announced Wednesday.

Monsanto Chairman and CEO Hugh Grant said the deal "represented the most compelling value for our shareholders, with the most certainty through the all-cash consideration."

Bayer said it would raise the cash to pay for Monsanto by issuing debt and $19 billion in equity, including a mandatory convertible bond and a rights issue. </s> German drug and farm chemical company Bayer AG said Wednesday it has signed a deal to acquire seed and weed-killer company Monsanto for $66 billion in cash.

Bayer said it is paying Monsanto shareholders $128 per share, which represents a 44% premium over Monsanto's closing price on May 9, the day before a proposed deal was announced.

The deal is subject to approval by Monsanto shareholders and antitrust regulators.

Bayer said the transaction brings together two different but complementary companies. Bayer makes a wide range of crop protection chemicals, while Monsanto is known for its seed business.

Leverkusen-based Bayer said the merged companies' agriculture business would have its seed business and North American business headquarters in St. Louis, where Monsanto is based.

Bayer initially offered $122 per share, only to be rebuffed by Monsanto management, and then $125 per share before reaching the deal announced Wednesday.

Monsanto Chairman and CEO Hugh Grant said the deal "represented the most compelling value for our shareholders, with the most certainty through the all-cash consideration."

Bayer said it would raise the cash to pay for Monsanto by issuing debt and $19 billion in equity, including a mandatory convertible bond and a rights issue.

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5:35 a.m.: This article has been updated with additional information.

This article was originally published at 5 a.m. </s> Monsanto, Bayer AG in $US66 billion deal to create world's largest seed and chemical supplier

After months of courtship, German pharmaceutical and chemical giant Bayer AG has finally stuck a deal to buy out American biotechnology company Monsanto.

Bayer AG, the company that invented aspirin and once trademarked 'Heroin' as a cough medicine, wooed Monsanto's board with a $US66 billion ($88 billion) offer on Wednesday night Australian time.

If successful, the deal, touted as the year's largest, will make Bayer AG the world's largest agricultural seed and chemical supplier.

It follows a string of similar mergers in the sector.

American industrial giants Dow Chemical and DuPont pioneer struck a merger in December last year, and Swiss-based chemical and seed company Syngenta agreed to a takeover by Chinese industrial giant ChemChina in February this year.

Now the internal negotiations are over, the biggest hurdle faced by the deal will be seeking approval from competition regulators around the globe.

Already, US Democratic senator and former primary candidate Bernie Sanders has slammed the deal, calling it a "marriage made in hell" and urging the US Department of Justice to block the deal.

Iowa State University Emeritus Professor Neil E Harl believes the deal should be blocked and a full market study undertaken into the lasting impact of the consolidation.

"There isn't enough attention given to who wins and loses in the long term from these deals," he said.

"You can definitely research this, it will give us all more information, and the time has come to take long-term view of the consequences."

The most worrying consequence for Professor Harl is having too much ownership of critical seeds and crop chemicals concentrated in the hands of too few companies.

In the future, these companies will also hold massive amounts of farm data, collected from precision farming equipment as well.

Monsanto's market leadership in agricultural seeds and chemicals makes it a highly strategic acquisition for Bayer AG, which itself is a dominant crop chemical company.

NSW farmer Dan Cooper advises the Australian Consumer and Competition Commission on agricultural policy, and said farmers were waiting for more details of the deal to emerge.

"Lessening of the competition is the main concern, but also that investment in research and investment could decrease too," he said.

"Every time a famer buys chemicals or seeds, the research and development behind that probably originated from one of those major companies."

The three companies that will emerge if the deals are approved — Dow-DuPont, ChemChina-Syngenta and Bayer-Monsanto — will collectively control close to three-quarters of the agricultural chemical seeds market, according to analysis by Bloomberg.

PAC Partners agribusiness analyst Paul Jensz has faith the competition regulators will act as a sufficient check and balance to the major mergers, but says mid-sized companies will also offer an alternative to farmers.

"Australia's Nufarm is one example that provides a strong alternative, with its options of generic crop chemical that have come off patent," he said.

"It's also important to consider the massive, massive amounts of money required for new research and development, and these major companies will be better positioned to undertake that." </s> NEW YORK — German drugs and crop chemicals company Bayer has won over U.S. seeds firm Monsanto with an improved takeover offer of around $66 billion, ending months of wrangling after increasing its bid for a third time.

The $128 a share deal, up from Bayer's previous offer of $127.50 a share, is the biggest of the year so far and the largest cash bid on record.

The deal will create a company commanding more than a quarter of the combined world market for seeds and pesticides in the fast-consolidating farm supplies industry.

However, competition authorities are likely to scrutinize the tie-up closely, and some of Bayer's own shareholders have been highly critical of a takeover plan which they say risks overpaying and neglecting the company's pharmaceutical business.

The transaction includes a break-fee of $2 billion that Bayer will pay to Monsanto should it fail to get regulatory clearance. Bayer expects the deal to close by the end of 2017.

The details confirm what a source close to the matter told Reuters earlier.

Bernstein Research analysts said on Tuesday they saw only a 50 percent chance of the deal winning regulatory clearance, although they cited a survey among investors that put the likelihood at 70 percent on average

"We believe political pushback to this deal, ranging from farmer dissatisfaction with all their suppliers consolidating in the face of low farm net incomes to dissatisfaction with Monsanto leaving the United States, could provide significant delays and complications," they wrote in a research note.

Bayer said it was offering a 44 percent premium to Monsanto's share price on May 9, the day before it made its first written proposal.

It plans to raise $19 billion to help fund the deal by issuing convertible bonds and new shares to its existing shareholders, and said banks had also committed to providing $57 billion of bridge financing.

Bayer's move to combine its crop chemicals business, the world's second largest after Syngenta AG, with Monsanto's industry leading seeds business, is the latest in a series of major tie-ups in the agrochemicals sector.

The German company is aiming to create a one-stop shop for seeds, crop chemicals and computer-aided services to farmers. That was also the idea behind Monsanto's swoop on Syngenta last year, which the Swiss company fended off, only to agree later to a takeover by China's state-owned ChemChina. Elsewhere in the industry, U.S. chemicals giants Dow Chemical and DuPont plan to merge and later spin off their respective seeds and crop chemicals operations into a major agribusiness. The Bayer-Monsanto deal will be the largest ever involving a German buyer, beating Daimler's tie-up with Chrysler in 1998, which valued the U.S. carmaker at more than $40 billion. It will also be the largest all-cash transaction on record, ahead of brewer InBev's $60.4 billion offer for Anheuser-Busch in 2008.

Antitrust experts have said regulators will likely demand the sale of some soybeans, cotton and canola seed assets as a condition for approving the deal. </s> It is being reported that Monsanto will soon be taken over by Bayer AG. The sides have come together and agreed on a cash deal of 66 billion dollars.

Monsanto, a company specializing in seed and weed killer, has demanded a whopping $128 per share, a number highly inflated from its initial closing price, four months ago.

This deal is yet to be approved, but the combination of Bayer’s crop protection background, paired with Monsanto’s wide reach in the seed industry has the prospective, German-based owners grinning. The company would shift its main North American headquarters to Monsanto’s current location – St. Louis, Missouri.

The 66 billion dollar deal will be the largest takeover in 2016. </s> The German pharmaceutical and chemicals group Bayer said it would sweeten its offer for US rival Monsanto.

In a statement released late Monday, Bayer said it would raise its offer for the US seed giant to $127.50 per share from $125. That would bring the deal's total value to almost $66 billion including debt.

Monsanto confirmed Bayer's improved bid for a friendly takeover and said it was evaluating the proposal, "as well as proposals from other parties and other strategic alternatives".

It said there was no guarantee a deal would be struck.

Monsanto rejected Bayer's previous offer in mid-July, saying it was "financially inadequate", but left the door open to further discussions.

With its new offer, Bayer also said it has no intention of carrying out a hostile takeover.

The German daily Handelsblatt reported in mid-August that Bayer was considering a hostile bid if faced with ongoing opposition from Monsanto.

A deal would create a global leader in genetically modified seeds and pesticides.

Monsanto pursued its own takeover of Swiss Syngenta for more than a year as well as BASF SE's agrochemicals unit, Bloomberg reported.

Germany's BASF could still play the role of white knight helping Monsanto fend off Bayer's bid, Bloomberg said in mid-July.

Bayer was down 0.20 percent in early trade on the Frankfurt stock exchange Tuesday. </s> Bayer AG BAYRY 1.19% raised its offer to buy Monsanto Co. and create a new global leader in seeds and pesticides, though the German firm said the higher price depended on achieving a “negotiated transaction.”

Bayer, which has been discussing a deal with Monsanto since mid-May, said it would pay $127.50 a share for the St. Louis-based biotech seed giant, up from its previous offer of $125 a share. The higher offer values Monsanto at over $65 billion, including debt.

Monsanto acknowledged the improved offer, and called the discussions with Bayer “constructive.”

“Monsanto is continuing these conversations as it evaluates this proposal, as well as proposals from other parties and other strategic alternatives to enable its Board of Directors to determine if a transaction in the best interests of its shareowners can be realized,” officials for the company said.

Executives of the pharmaceutical giant have said that acquiring Monsanto, the world’s largest supplier of crop seeds and genes, will create a global firm with a deep portfolio in pesticides, positioned to help farmers around the world produce food for a growing and more affluent population.

Werner Baumann, who took over as Bayer’s chief executive just weeks before launching what would be the aspirin maker’s biggest-ever acquisition, is pursuing the deal as rivals in the $100 billion global market for seeds and pesticides seal their own mergers. Mr. Baumann has faced pushback from some Bayer shareholders, however, who have worried about Bayer shifting focus away from its pharma division.

Monsanto has said it sees the virtues of combining its prowess in seeds with Bayer’s much broader range of pesticides, but Monsanto’s board in July unanimously rejected Bayer’s previous offer of $125 a share as too low and “insufficient to ensure deal certainty.” Analysts have said around $135 to $140 a share may be a more realistic price.

Bayer said Monday that there was no assurance a deal would be struck, and if one was, it would remain subject to regulatory approvals.

Monsanto shares settled Friday at $107.44. Bayer shares settled 0.7% lower Monday at €94.24 (about $105).

Monsanto is weighing Bayer’s takeover proposal as the U.S. company’s own profits have come under pressure from the slumping farm economy, where bin-busting harvests have pushed down grain prices and forced farmers in the U.S. and elsewhere to reduce spending on everything from crop seeds to tractors and land. The U.S. Department of Agriculture last week projected that U.S. farm incomes this year will hit their lowest point since 2009, forcing more farmers to consider switching to generic weedkillers, put off buying new machinery, and trade down to cheaper seeds.

Monsanto has responded to the downturn by laying off about 16% of its global workforce and curtailing some research projects, including a Brazilian sugar cane effort.

While Bayer has touted its deal as offering Monsanto investors an attractive price for the company, some Monsanto shareholders have said that Monsanto should seek a higher figure based on the long-term potential of some of its investments, including a data analytics business that crunches weather, soil and crop information to formulate farming advice.

Bayer and Monsanto have few alternative partners. DuPont Co. and Dow Chemical Co. , which both maintain big divisions focused on seeds and crop sprays, unveiled their own merger in December, a plan that eventually will lead to the spinoff of three independent companies, including one focused on agriculture. That deal’s closing now is likely to slip into early 2017 after European Union antitrust officials moved to open an in-depth probe of the deal, citing competitive concerns in herbicides and insecticides, among other product lines.

Syngenta AG , another top seed and pesticide maker, is moving ahead with a planned sale to China National Chemical Corp. for $43 billion, in a deal that would broadly expand China’s heft in high-tech seed development as the country works to modernize its agricultural sector. That deal last month won a key nod from the Committee on Foreign Investment in the U.S.

Write to Jacob Bunge at jacob.bunge@wsj.com </s> FRANKFURT/NEW YORK (Reuters) - Chemicals and healthcare group Bayer AG (BAYGn.DE) is poised to announce the acquisition of U.S. seeds company Monsanto Co MON.N on Wednesday for more than $66 billion, clinching the biggest deal of the year, people familiar with the matter said.

A trader works at the post where Monsanto Co. is traded on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., August 25, 2016. REUTERS/Brendan McDermid

By accepting Bayer’s offer, the largest cash acquisition proposal on record, Monsanto is set to give the German company a shot at grabbing the top spot in the fast-consolidating farm supplies industry, combining its crop science business with Monsanto’s strength in seeds. It will also set the stage for the deal to be closely scrutinized by antitrust regulators.

The breakthrough in negotiations, which follows more than four months of talks, came after Bayer further improved on the sweetened offer of $127.50 per share in cash it disclosed last week, the people said.

However, the deal will still value Monsanto at less than $130 per share, which the company was previously hoping to fetch, the people added.

Once St. Louis, Missouri-based Monsanto’s board of directors approves the deal on Tuesday, Leverkusen-based Bayer’s supervisory board will meet on Wednesday to also authorize the transaction, with an announcement expected before the stock market opens in New York on Wednesday, some of the people said.

It is still possible the board of either company could decide to walk away from the deal at the last minute, the people cautioned.

The sources asked not to be identified because the deliberations are confidential. Bayer and Monsanto declined to comment.

Monsanto’s shares ended 0.8 percent lower at $106.10 in New York on Tuesday amid uncertainty over whether any agreed deal will clear antitrust hurdles. The stock later climbed to $108.79 in after-hours trading. Bayer shares ended trading in Frankfurt down 0.3 percent at 93.3 euros.

Bayer said last week talks with Monsanto had advanced and that it was willing to offer $127.50 per share, up from $125 previously, valuing Monsanto at more than $65 billion, including debt.

Sources told Reuters that topping up the price secured Bayer access to more privileged information on Monsanto’s business performance and paved the way for more detailed negotiations.

“Given recent updates on the Monsanto approach suggest a final conclusion may be close, we suspect (Bayer) will work hard to try and reach a final conclusion before the Meet Management event, if possible,” Jefferies Research analyst Jeffrey Wolford said in a research note before the news, referring to Bayer’s presentations day for analysts and investors in Cologne next Tuesday.

Bayer’s bid to combine its crop chemicals business, the world’s second-largest after Syngenta AG SYNN.S, with Monsanto’s industry leading seeds business, is the latest in a series of major consolidation moves in the agrochemical sector.

U.S. chemicals giants Dow Chemical (DOW.N) and DuPont (DD.N) have agreed to merge and spin off their respective seeds and crop chemicals operations into a major agribusiness.

Syngenta last year fought off unwanted suitor Monsanto, only to later agree to a takeover by ChemChina.
German chemicals company Bayer AG will announce that it has acquired American seeds company Monsanto Co. for US$66 billion.