Jan. 8, 2018
Bayer Chairman and CEO Werner Baumann
Bayer CEO Werner Baumann has begun to market US assets owned by the German conglomerate in order to win clearance for its $66 billion merger with Monsanto, The Post has learned.
The assets — which are expected to include a vegetable seeds business and a software unit that helps farmers determine soil conditions for crops — are said to represent more than the $1.6 billion in sales as required under the merger agreement when including the previously announced sale to BASF, sources said.
The asset auctions signal that Bayer believes it has adequate direction from the European Commission and the Justice Department on what it must do to win approval for the Monsanto deal, valued at $128 per share, sources said.
“I’m pretty confident there will be divests and the merger will get through,” a DC source close to the situation said.
Monsanto shares on last Wednesday, meanwhile, closed at $118, indicating investors believe there is about a 40-percent chance of the deal getting done, according to a trader.
Bayer CEO Baumann met several times last month with groups of investors explaining how he was resolving the European Commission’s concerns about the merger, sources at the meetings said. Baumann also said he expects the merger to close in the first quarter, according to the sources.
The DOJ staff is expected to recommend whether to approve the Bayer-Monsanto merger by the end of the month, sources said. The Europeans and the DOJ are said to be coordinating efforts.
Monsanto has reported earnings on last Thursday. Investors at Monsanto’s closing $117.92 share price believe there is at best only a 40 percent chance regulators clear the September 2016 deal that would combine two of the world’s biggest seed and pesticide companies.
“As we’ve said from the beginning, this opportunity is about combining highly complementary businesses and bringing new innovative solutions to our customers,” Bayer said in a statement. “We remain confident in our ability to obtain all necessary regulatory approvals and look forward to continuing to work diligently with regulators to support that process.”
Chris Pawelski, an Orange County, NY onion farmer who uses Monsanto and Bayer products, said he hopes the combined company spends more money on research and development of onion seeds and pesticides that would help his 100-acre crop.
But Pawelski said he is also concerned that combining the two companies could cause prices to rise.