Germany’s Bayer may get hostile with bid for Monsanto
GERMAN chemicals giant Bayer may launch a hostile takeover bid for US seed and pesticide maker Monsanto if its latest friendly offer falls through, business daily Handelsblatt reported yesterday.
Monsanto has already rejected two offers from the German firm, calling an increased US$125-pershare bid in July “financially inadequate” while keeping the door open to further discussions.
“Bayer is prepared to turn directly to the shareholders” to secure a deal if Monsanto management insists on a price the Germans see as too risky, the paper reported, citing sources close to the company.
“In the coming weeks, chief executive Werner Baumann will make a decision: namely whether a friendly merger is still possible, or whether Bayer must choose an alternative path,” Handelsblatt said in its report.
By merging the two companies, Baumann hopes to create a globally dominant agrochemical firm with revenues of up to $25 billion (22 billion euros).
Bayer’s last offer valued Monsanto at around $64 billion.
But some observers expect Monsanto CEO Hugh Grant to reject any offer of less than $67-69 billion as he sees greater growth potential for the German firm, a spokesperson for Bayer shareholder Union investment told the newspaper.
A hostile offer could see Bayer approaching its upper limit, as it might have to offer a 5 to 10 percent increase on its last bid, the paper noted.
Bayer declined to comment on the report when contacted but industry sources said the bid was definitely on the cards. –
The logo of German multinational chemical and pharmaceutical company Bayer AG shines above the company's plant in Leverkusen, Germany. Bayer is determined to buy US corporation Monsanto.