Exclusive: Bayer nears acquisition of Monsanto - sources

Tue Sep 13, 2016 10:19pm EDT
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By Arno Schuetze and Greg Roumeliotis

FRANKFURT/NEW YORK (Reuters) - Chemicals and healthcare group Bayer AG (BAYGn.DE: Quote) is poised to announce the acquisition of U.S. seeds company Monsanto Co (MON.N: Quote) on Wednesday for more than $66 billion, clinching the biggest deal of the year, people familiar with the matter said.

By accepting Bayer's offer, the largest cash acquisition proposal on record, Monsanto is set to give the German company a shot at grabbing the top spot in the fast-consolidating farm supplies industry, combining its crop science business with Monsanto's strength in seeds. It will also set the stage for the deal to be closely scrutinized by antitrust regulators.

The breakthrough in negotiations, which follows more than four months of talks, came after Bayer further improved on the sweetened offer of $127.50 per share in cash it disclosed last week, the people said.

However, the deal will still value Monsanto at less than $130 per share, which the company was previously hoping to fetch, the people added.

Once St. Louis, Missouri-based Monsanto's board of directors approves the deal on Tuesday, Leverkusen-based Bayer's supervisory board will meet on Wednesday to also authorize the transaction, with an announcement expected before the stock market opens in New York on Wednesday, some of the people said.

It is still possible the board of either company could decide to walk away from the deal at the last minute, the people cautioned.

The sources asked not to be identified because the deliberations are confidential. Bayer and Monsanto declined to comment.

Monsanto's shares ended 0.8 percent lower at $106.10 in New York on Tuesday amid uncertainty over whether any agreed deal will clear antitrust hurdles. The stock later climbed to $108.79 in after-hours trading. Bayer shares ended trading in Frankfurt down 0.3 percent at 93.3 euros.   Continued...

A trader works at the post where Monsanto Co. is traded on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., August 25, 2016. REUTERS/Brendan McDermid