Monsanto spurns Bayer’s $62B offer
Agricultural and seed giant Monsanto has turned down German drug company Bayer AG’s $62 billion acquisition bid as “financially inadequate.”
Monsanto issued a statement Tuesday that its board of directors unanimously voted down Bayer’s proposal. However, the St. Louis-based company is open to continued talks with Bayer “to assess whether a transaction in the best interest of Monsanto shareowners can be achieved.”
Bayer on Monday offered $122 a share for Monsanto, a 37% premium over the closing price of $89.03 on May 9, which is the day before Bayer sent a written proposal to Monsanto.
Combining Monsanto, the world’s largest seed company, with Bayer’s crop protection products would create the world’s largest agricultural supplier. As a combined company, the two chemical giants could reap $1.5 billion in savings after the third year, with additional bene- fits in future years, Bayer AG CEO Werner Baumann said Monday.
Monsanto’s opening to additional negotiations suggests that it sees the positive, too.
“We have long respected Bayer’s business,” Chairman and CEO Hugh Grant said in a statement. “However, the current proposal significantly undervalues our company and also does not adequately address or provide reassurance for some of the potential financing and regulatory execution risks related to the acquisition.”
Bayer declined to comment. Shares of Bayer were up 2.8% to $98.17 in New York trading Tuesday. Monsanto shares were up 3.1% to $109.30.