Bayer Agrees to Sell Parts of its Business to BASF

Anthony Shevlin and Natalia Drozdiak reported today at The Wall Street Journal Online that, “Bayer AG on Friday said it has agreed to sell parts of its crop-science business to rival BASF SE for €5.9 billion ($6.98 billion), a bid to assuage regulators as the German chemical conglomerate seeks approval for its $57 billion acquisition of U.S. seed maker Monsanto Co.

“Bayer said it would use the net proceeds from the transaction to partially refinance the purchase of Monsanto, a deal struck last year that is set to create an industrial powerhouse and tilt the German company heavily toward agriculture in a long-range bet on high-tech crops.

“But the megadeal still faces scrutiny from U.S., European and other antitrust regulators.”

The Journal writer noted that, “The EU in August opened an in-depth investigation into the Bayer-Monsanto deal, saying it had ‘serious doubts’ because it could add pressure on farmers already struggling against low crop prices. Brazil’s competition authority in early October also said it would scrutinize the transaction. The U.S. is also carrying out a review.”

Today’s article added that, “Bayer’s deal with BASF is contingent on the successful completion of the Monsanto deal, which is expected to be completed early next year.

“Under the deal announced Friday, BASF will acquire Bayer’s manufacturing sites for glufosinate-ammonium production and formulation in Germany, the U.S. and Canada; its seed-breeding facilities in the Americas and Europe; and its trait-research facilities in the Americas and Europe.”

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