Monsanto rejects Bayer $62bn bid

NEW YORK, May 24, (AFP): US agribusiness giant Monsanto Co rejected Tuesday the $62 billion takeover bid by Germany’s Bayer AG as too low, but said it was willing to entertain further talks on a merger.

Monsanto chairman and chief executive Hugh Grant said in a statement that the offer “significantly undervalues our company” and does not give enough assurance on how Bayer would finance the deal or overcome possible regulatory challenges.

Monsanto’s board “unanimously views the Bayer AG proposal as incomplete and financially inadequate, but is open to continued and constructive conversations to assess whether a transaction in the best interest of Monsanto shareowners can be achieved,” the statement said.

Bayer made what amounts to the largest-ever takeover offer by a German company on Monday for the world leader in seeds, farm pesticides and genetically modified crops.

The $122 a share cash offer sent Monsanto shares surging but only to $106 amid expectations of Monsanto’s rejection and questions over whether Bayer would increase the bid. Bayer shares had tumbled on the news.

Monsanto’s shares were up 1.7 percent to $107.77 in early afternoon trade Tuesday.

Bayer shares traded in Frankfurt had fallen last week on expectations of the proposal, and dropped another 5.7 percent to 84.42 euros ($94.09) on Monday.

With unconfirmed reports of Monsanto’s coming rejection already in the markets, Bayer shares rebounded 3.2 percent Tuesday to 87.15 euros.