Bayer sells units to be able to complete Monsanto takeover

BASF has agreed to buy seed and herbicide businesses from Bayer for 5.9 billion euros ($7 billion) in cash, as Bayer tries to convince competition authorities to approve its planned acquisition of Monsanto, the Creve Coeur-based seed and agrochemical giant.

BASF, the world’s third-largest maker of crop chemicals, has so far avoided seed assets and instead pursued research into plant characteristics, which it sells or licenses out to seed developers.

But Bayer’s $66 billion deal to buy Monsanto, announced in September 2016, has created opportunities for rivals to snatch up assets that need to be sold to satisfy competition authorities.

Bayer had offered to sell assets worth around $2.5 billion. The European Commission said in August that the divestments offered by Bayer so far did not go far enough and started an in-depth investigation of the deal.

Bayer has to sell the LibertyLink-branded seeds and Liberty herbicide businesses because they compete with Monsanto’s Roundup weedkiller and Roundup Ready seeds.

BASF will finance the acquisition through a combination of cash on hand, commercial paper and bonds. It expects the acquisition to add to its earnings by 2020.

Read more: St. Louis Post-Dispatch, Bloomberg


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