Monsanto finally succumbs to Bayer's takeover advances

14 September 2016

In what will be a truly game-changing acquisition for Germany’s Bayer (BAYN: DE), the USA’s GMO giant Monsanto (NYSE: MON) has accepted its improved bid, valuing the latter at around $66 billion.

Bayer and Monsanto today announced that they signed a definitive merger agreement under which Bayer will acquire Monsanto for $128 per share in an all-cash transaction. Monsanto’s board of directors, Bayer’s board of management and its supervisory board have unanimously approved the agreement. Based on Monsanto’s closing share price on May 9, 2016, the day before Bayer’s first written proposal to Monsanto, the offer represents a premium of 44% to that price.

Bayer, which thus far has been a predominantly pharmaceutical company with a significant crop sciences business, rose 2.4% to 95.58 euros at 12:20 pm today. Monsanto was up a marginal 0.3% at $106.10 in pre-market trading. Bayer’s first offer price for Monsanto was $122 per share, which was later upped to $125 and then $127.50.

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