World Grain - October 2016 - 12

NEWSREVIEW

Bayer to buy Monsanto in a $66 billion transaction
LEVERKUSEN, GERMANY - Bayer AG on Sept. 14 agreed to
acquire St. Louis, Missouri, U.S.-based Monsanto Co. in an all-cash
transaction for $128 per share, equating to a total purchase price of
approximately $66 billion. The transaction price represents a 44%
premium to Monsanto's share price on May 9, the day before Bayer
VXEPLWWHGLWV¿UVWZULWWHQSURSRVDOWRDFTXLUH0RQVDQWR
³:HDUHSOHDVHGWRDQQRXQFHWKHFRPELQDWLRQRIRXUWZRJUHDW
RUJDQL]DWLRQV´ VDLG :HUQHU %DXPDQQ FKLHI H[HFXWLYH RI¿FHU
&(2 RI %D\HU$* ³7KLV UHSUHVHQWV D PDMRU VWHS IRUZDUG IRU
our Crop Science business and reinforces Bayer's leadership
SRVLWLRQDVDJOREDOLQQRYDWLRQGULYHQ/LIH6FLHQFHFRPSDQ\ZLWK
leadership positions in its core segments, delivering substantial
value to shareholders, our customers, employees and society at
large."
Hugh Grant, chairman and CEO of Monsanto, called the deal a
³WHVWDPHQWWRHYHU\WKLQJZH¶YHDFKLHYHGDQGWKHYDOXHWKDWZHKDYH
created for our shareholders."
³:H EHOLHYH WKDW WKLV FRPELQDWLRQ ZLWK %D\HU UHSUHVHQWV WKH
PRVWFRPSHOOLQJYDOXHIRURXUVKDUHRZQHUVZLWKWKHPRVWFHUWDLQW\
through the all-cash consideration," 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
still must receive approval from regulatory agencies. In a Sept. 14
FRQIHUHQFHFDOOZLWKDQDO\VWV%DXPDQQVDLGWKHFRPSDQLHVDOUHDG\

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.
%D\HU¿UVWPDGHDSOD\IRU0RQVDQWREDFNLQPLG0D\DQRIIHU
WKDW ZDV TXLFNO\ UHEXIIHG E\ 0RQVDQWR 2Q -XO\  %D\HU UDLVHG
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
³¿QDQFLDOO\LQDGHTXDWHDQGLQVXI¿FLHQWWRHQVXUHGHDOFHUWDLQW\´
$FFRUGLQJ WR WKH FRPSDQLHV WKH WUDQVDFWLRQ ZLOO XQLWH WZR
"different, but highly complementary businesses." The combined
EXVLQHVVLVH[SHFWHGWREHQH¿WIURP0RQVDQWR¶VOHDGHUVKLSLQVHHGV
DQGWUDLWVDQG&OLPDWH&RUSSODWIRUPDORQJZLWK%D\HU¶VEURDGFURS
protection product line.
7KH FRPELQDWLRQ DOVR ZLOO EULQJ WRJHWKHU ERWK FRPSDQLHV¶
LQQRYDWLRQ FDSDELOLWLHV DQG 5	' WHFKQRORJ\ SODWIRUPV ZLWK DQ
annual pro-forma R&D budget of approximately €2.5 billion.
)ROORZLQJFRPSOHWLRQRIWKHWUDQVDFWLRQWKHFRPELQHGDJULFXOWXUH
EXVLQHVV ZLOO KDYH LWV JOREDO 6HHGV 	 7UDLWV DQG 1RUWK$PHULFDQ
commercial headquarters in St. Louis, Missouri, its global Crop
Protection and overall Crop Science headquarters in Monheim,
Germany, and an important presence in Durham, North Carolina,
86DVZHOODVPDQ\RWKHUORFDWLRQVWKURXJKRXWWKH86DQGDURXQG
WKHZRUOG7KH'LJLWDO)DUPLQJDFWLYLWLHVIRUWKHFRPELQHGEXVLQHVV
ZLOOEHEDVHGLQ6DQ)UDQFLVFR&DOLIRUQLD86

Cargill expands canola research facility
WINNIPEG, MANITOBA, CANADA - Cargill announced on
Aug. 30 a $3.5 million expansion of its canola research facility in
$EHUGHHQ6DVNDWFKHZDQ&DQDGD
Cargill said the facility improvements included a 14,000-squareIRRW H[SDQVLRQ H[SDQGHG SDWKRORJ\ ODE QHZ TXDOLW\ DVVXUDQFH
ODE YHQWLODWHG VHHG SUHS URRP DQG KLJK HI¿FLHQF\ /(' OLJKWLQJ
WKURXJKRXWWKHIDFLOLW\ZLWK89UHSHOOLQJZLQGRZV
³7KHQHZIDFLOLW\ZLOODOVRDOORZ&DUJLOOWRVKRZFDVHWKHUHVHDUFK
DQG LQQRYDWLRQV ZLWKLQ RXU VSHFLDOW\ FDQROD EXVLQHVV´ VDLG 0DUN
Christiansen, managing director, Cargill Global Edible Oil Solutions.

³,QQRYDWLRQVVXFKDVDQHZORZVDWXUDWHGKLJKROHLFFDQRODRLODUH
GULYHQE\RXU9LFWRU\\LHOGSODWIRUPZKLFKLVFXUUHQWO\EHVWRIFODVV
for Roundup Ready hybrids, in addition to best-of-class Blackleg
resistance."
6DVNDWFKHZDQ FRQWLQXHV WR EH DQ LPSRUWDQW SURYLQFH IRU &DUJLOO
to invest in, the company said. Cargill has 26% of its Canadian
LQYHVWPHQWLQWKHSURYLQFHDQGRYHUWKHSDVW¿YH\HDUVKDVFRQWLQXHG
WR LQFUHDVH LWV IRRWSULQW ZLWK PRUH WKDQ  PLOOLRQ LQ FDSLWDO
investments. Cargill employs more than 450 employees in the
SURYLQFHRI6DVNDWFKHZDQZLWKVL[EXVLQHVVHVDFURVVORFDWLRQV

Record China 2016-17 soybean imports expected
%(,-,1*&+,1$²&KLQD¶VVR\EHDQLPSRUWVZHUHIRUHFDVWWRKLWD
record high of 86 million tonnes in the 2016-17 marketing year that
began Oct. 1, up from an estimated 83 million tonnes in 2015-16,
DFFRUGLQJWRD*$,1UHSRUW¿OHG$XJE\WKH)RUHLJQ$JULFXOWXUDO
Service (FAS) of the U.S. Department of Agriculture (USDA).
 7KH IRUHFDVW IRU  VR\EHDQ LPSRUWV ZDV VOLJKWO\ ORZHU WKDQ
WKHRI¿FLDO86'$GDWDIRUHFDVWRIPLOOLRQWRQQHV,QFUHDVHG&KLQHVH
demand for industry feed and protein meal as a result of a recovery in
VZLQHSURGXFWLRQDQGVWHDG\JURZWKLQWKHSRXOWU\VHFWRUZDVVHHQDVWKH
market driver behind the increase in soybean imports to record-high levels.
"China's recent sale of stored oilseed and oilseed product reserves
(soybeans and rapeseed oil) is expected to absorb market share for food
VR\EHDQVDQGYHJHWDEOHRLOV´WKH*$,1UHSRUWVDLG³+RZHYHUIRUHFDVW
ORZHULPSRUWVRI''*6GLVWLOOHUV¶GULHGJUDLQVZLWKVROXEOHVDVDUHVXOW
of China's anti-dumping investigation may increase demand for soybean
PHDODQGWKXVVXSSRUWJURZWKLQVR\EHDQLPSRUWV´
&KLQD H[SHFWV LWV RZQ SURGXFWLRQ RI VR\EHDQV WR JURZ GXULQJ
WKH VDPH SHULRG DV D UHVXOW RI LQFUHDVHV LQ SODQWHG DUHD UHÀHFWLQJ
government efforts to restructure the crop mix and better yields. The
12

&KLQD$JULFXOWXUDO2XWORRN&RPPLWWHHDI¿OLDWHGZLWKWKHPLQLVWU\RI
agriculture) forecast 12.86 million tonnes of soybeans in 2016-17 on
KLJKHU \LHOGV DQG IDYRUDEOH ZHDWKHU XS IURP D SUHYLRXV IRUHFDVW RI
12.76 million tonnes. The China National Grain and Oilseed Information
Center issued a forecast of 12.6 million tonnes for 2016-17, up 8.6%
from the previous year.
In addition, an independent oilseed information source predicted
&KLQD¶V GRPHVWLF SURGXFWLRQ RI VR\EHDQV LQ  ZLOO WRWDO 
million tonnes, up 3.67 million tonnes from an estimated 10.43 million
tonnes estimated in 2015-16.
)RUHFDVWORZHUUDSHVHHGDQGFRWWRQVHHGSURGXFWLRQLQ&KLQDLQ
DOVRZDVH[SHFWHGWRLQFUHDVHVR\EHDQLPSRUWVIRUSURWHLQPHDO
The GAIN report forecast 2016-17 imports of rapeseed to China at
 WRQQHV DERYH WKH 86'$ RI¿FLDO IRUHFDVW RI  WRQQHV &KLQHVH
SHDQXWLPSRUWVLQZHUHHVWLPDWHGWRGHFOLQHWRWRQQHV
GRZQIURPWRQQHVLQDVDUHVXOWRIVWURQJGRPHVWLF
SURGXFWLRQ 7KH H[SHFWHG GHFOLQH LQ SHDQXW LPSRUWV UHÀHFWHG VWURQJ
JDLQVLQGRPHVWLFDFUHDJHFRXSOHGZLWKDFRQWLQXLQJGHSUHFLDWLRQLQWKH
value of the Chinese currency.
October 2016 / World Grain / www.World-Grain.com
http://www.World-Grain.com
World Grain - October 2016

Table of Contents for the Digital Edition of World Grain - October 2016
