Milling & Baking News - September 27, 2016 - 45

International

Bayer AG to buy Monsanto in
$66 billion transaction
LEVERKUSEN, GERMANY - Bayer
AG on Sept. 14 agreed to acquire St.
Louis-based Monsanto Co. in an allcash transaction for $128 per share,
equating to a total purchase price
of approximately $66 billion. The
transaction price represents a 44%
premium to Monsanto's share price
on May 9, the day before Bayer submitted its first written proposal to
acquire Monsanto.
"We are pleased to announce the
combination of our two great organizations," said Werner Baumann,
chief executive officer of Bayer AG.
"This represents a major step forward for our Crop Science business

On July 14, Bayer raised its all-cash
offer to $125 per share from $122 per
share, but still the board of directors of
Monsanto described the takeover bid
as "financially inadequate and insufficient to ensure deal certainty."
According to the companies, the
transaction will unite two "different,
but highly complementary businesses." The combined business is expected to benefit from Monsanto's leadership in seeds and traits and Climate
Corp. platform along with Bayer's
broad crop protection product line.
The combination also will bring
together both companies' innovation
capabilities and R.&D. technology

Bayer AG
Headquarters Leverkusen, Germany
2015 sales (millions)
$50,493
2015 net income (millions) $4,480
Employees
115,576

and reinforces Bayer's leadership
position as a global innovation-driven Life Science company with leadership positions in its core segments,
delivering substantial value to shareholders, our customers, employees
and society at large."
Hugh Grant, chairman and c.e.o.
of Monsanto, called the deal a "testament to everything we've achieved
and the value that we have created for
our shareholders."
"We believe that this combination
with Bayer represents the most compelling value for our shareowners,
with the most certainty through the
all-cash consideration," Mr. Grant
said.
The transaction has been approved
by the boards of both companies and
is expected to be completed by the end
of 2017, but it still must receive approval from regulatory agencies. In a
Sept. 14 conference call with analysts,
Mr. Baumann said the companies already have received "encouraging
feedback" from regulatory agencies.
A $2 billion reverse antitrust break fee
is in place in the event the transaction
fails to obtain the necessary regulatory
clearance.
Bayer first made a play for Monsanto back in mid-May, an offer that
was quickly rebuffed by Monsanto.
bakingbusiness.com / world-grain.com

Monsanto
St. Louis
$15,001
$2,314
22,500

platforms, with an annual pro-forma
R.&D. budget of approximately €2.5
billion.
"We are entering a new era in agriculture - one with significant challenges that demand new, sustainable
solutions and technologies to enable
growers to produce more with less,"
Mr. Grant said. "This combination
with Bayer will deliver just that - an
innovation engine that pairs Bayer's
crop protection portfolio with our
world-class seeds and traits and digital agriculture tools to help growers
overcome the obstacles of tomorrow.
Together Monsanto and Bayer will
build on our proud tradition and respective track records of innovation in
the agriculture industry, delivering a
more comprehensive and broader set
of solutions to growers."
Following completion of the transaction the combined agriculture business
will have its global Seeds & Traits and
North American commercial headquarters in St. Louis, its global Crop
Protection and overall Crop Science
headquarters in Monheim, Germany,
and an important presence in Durham, N.C., as well as many other locations throughout the United States and
around the world. The Digital Farming
activities for the combined business
will be based in San Francisco. MBN
Milling & Baking News XSeptember 27, 2016 / 45

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Milling & Baking News - September 27, 2016

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