German multinational company Bayer is currently negotiating an acquisition bid for US-based Monsanto. The chemical and pharmaceutical giant is likely to be subject to strict scrutiny, to ensure all regulations are adhered to if the deal with Monsanto goes ahead.
In a recent statement from Bayer, the company admitted that private talks have taken place regarding their possible acquisition of Monsanto. The resulting combination would further establish Bayer as a significant global player in the life sciences industry, and would create an integrated agricultural organisation which would lead the field.
Talks are currently in the early stages, with Monsanto also issuing a press statement confirming their receipt of Bayer’s proposal. The potential acquisition will, of course, be subject to a number of conditions, including regulatory approval and due diligence.
The news has come following several weeks of speculation regarding the possible purchase, estimated to be in the region of $62 billion.
Other Activity
Over six months ago, DuPont and Dow Chemical formed an agreement that would eventually see the new entity divided into three new organisations once the merger had taken place, one with a specific agricultural focus. On top of this, The Wall Street Journal reported an agreement by China National Chemical to acquire Syngenta. The regulatory authorities will be subjecting both deals to scrutiny.
Concern
There is concern, however, that US farmers will have to deal with an increase in prices as a result of the merger between Bayer and Monsanto, with the potential for further market limitations. This may also have a knock-on effect for the rest of the food processing industry. Those hoping to maximise resources might benefit from the used food processing machines market. Businesses who purchase used food machinery through Clarke Fussells and other auctioneers can significantly reduce initial outlay, or repair and replacement costs. Buying used machinery ensures companies have access to the very best value equipment and also benefits the environment, reducing the carbon footprint that they would be responsible for if purchasing new.
Currently Monsanto employs over 20,000 people. The company produces a large variety of seeds for vegetables, fruits and vital crops such as soybeans and corn. Bayer enjoys worldwide sales of around €46.3 billion and employs in the region of 117,000 workers.