Monsanto, DuPont strike $1.75 billion licensing deal, end lawsuits
By Carey Gillam
(Reuters) - DuPont Co will pay Monsanto Co at least $1.75 billion in a new licensing deal and both companies have agreed to dissolve their bitter legal battles over rights to technology for genetically modified seeds, the world's top seed companies said on Tuesday.
The companies agreed to drop antitrust and patent claims against each other while forging the new collaboration, and agreed to toss out a $1 billion jury verdict DuPont was ordered to pay Monsanto last August.
Separately, DuPont will make at least $1.75 billion in royalty payments over several years in exchange for broad access to Monsanto's leading genetic technology for the development of new agricultural seed products.
Monsanto shares finished up 4.4 percent at $103.79, while DuPont fell 0.3 percent to $48.97 by Tuesday's market close.
DuPont officials said the agreement was a win for shareholders and sets up its Pioneer agricultural seed unit for future growth.
"This is a smart deal for DuPont," Paul Schickler, president of DuPont Pioneer, said in an interview. "We've got access to two additional technologies that we can now combine with our existing technologies as well as the technologies that are in our pipeline."
DuPont Pioneer will have broad rights to important new technology that includes stacking of traits, Schickler said.
Monsanto, which generates revenues both through seed sales and licensing of its genetic seed technology to other companies, said the deal should bring in far more than the minimum $1.75 billion as DuPont pushes the company's technology through its broad customer base. Continued...