Monsanto shares rise on BASF buyout speculation

Date:04-14-2011

Monsanto shares rose Tuesday on speculation that German company BASF plans to buy the Creve Coeur-based seed maker.

Monsanto closed (NYSE: MON) up 3 percent Tuesday afternoon at $69.25 a share.

“Monsanto shares … are active on unconfirmed rumors that BASF is interested in the company,” Jon Najarian, co-founder of Chicago-based brokerage firm TradeMonster, told Reuters.

But sources also told Reuters that BASF has no current plans to buy Monsanto.

Monsanto and BASF already have a $2.5 billion partnership dating back to 2007 to develop higher-yielding and stress-tolerant crop, including wheat, corn, soy, cotton and canola crops. Last month, the two companies announced a new agreement to collaborate on the advancement of Dicamba-tolerant crops.

Chemical company BASF is based in Ludwigshafen, Germany.

Creve Coeur, Mo.-based Monsanto Co. (NYSE: MON), led by Chairman, President and CEO Hugh Grant, develops insect- and herbicide-resistant crops and other agricultural products. It reported $10.5 billion in revenue in 2010.

Monsanto declined to comment on the rumors Tuesday. The company did announce plans Tuesday for a five-year, $300 million public debt offering. Notes will be issued at 99.787 percent and bear interest at 2.75 percent, resulting in a yield of 2.796 percent. The notes mature on April 15, 2016, with a first interest payment date of Oct. 15, 2011.

The proceeds from the debt offering will be used for general corporate purposes, including repaying a note due to Pfizer Inc. related to Monsanto's acquisition of the Chesterfield Village research facility last year.

Monsanto's shelf registration was filed and became effective Oct. 31, 2008.