Ger­many’s Bayer may get hos­tile with bid for Mon­santo

The Myanmar Times - - International Business -

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. –

Photo: EPA

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.

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