Exclusive: Pivoting after failed Syngenta bid, Monsanto to build big data business
By P.J. Huffstutter and Carey Gillam
CHICAGO/KANSAS CITY (Reuters) - With its shares trading at three-year-lows since it abandoned a $46 billion bid to buy Syngenta AG SYNN.VX last month, Monsanto Co plans to offer its shareholders a new corporate vision: a future in big data.
Monsanto (MON.N: Quote) executives are seeking to reposition the company as a business built on data science and services, as well as its traditional chemicals, seeds and genetic traits operations, Chief Technology Officer Robert T. Fraley told Reuters in an interview.
“We transformed from industrial chemical company to a biotech company, then to a seeds company,” Fraley said. “Now, we’re transforming again.”
Top executives are sketching out plans now, and briefing major shareholders ahead of a wider presentation to investors in November at the company’s St. Louis headquarters, he said.
Fraley and others have met with around 200 technology start-ups in recent months and identified five as potential acquisition targets, pending Monsanto’s testing of products they make, company sources said. They declined to identify any possible targets.
Monsanto is seeking to provide services, software and hardware tools that use data to help farmers boost their crop yields by understanding what is happening with their fields – including catching shifts in soil chemistry, being more precise with their seed choices and knowing how they should apply pesticides in various conditions.
But the agricultural-data field is crowded, Monsanto’s initial moves into the sector have had spotty results and the shifting narrative is a sharp departure from the vision Monsanto described just weeks ago, as it bid for Syngenta. That vision was of a future based on agricultural chemicals and high-tech seeds.
The latest pivot comes as longtime profit stalwarts — the weed killer Roundup and the company’s portfolio of genetically modified seeds — both are showing signs of strain. Roundup's longevity as a farmer mainstay has become vulnerable as weed resistance to its active ingredient glyphosate has grown. Continued...