THE CREATION of the world’s largest biotechnology company through German business Bayer’s planned takeover of US giant Monsanto remains on hold after Monsanto rejected Bayer’s second takeover bid.
Bayer ramped up its offer by 2.4pc, taking its bid to$US125 or $A164 a share or $US64.5 or $A85.5 billion, but Monsanto has rejected the proposal, claiming it is ‘financially inadequate’, even though it represents a premium over 40pc above the Monsanto share price prior to the deal being launched.
However, Monsanto did not close the door on the deal, saying it was open to a continued dialogue.
A Bayer takeover of Monsanto would be the dénouement of a busy period in the biotech industry, where Dow and Dupont have merged and ChinaChem is in the process of taking over Syngenta.
Monsanto itself also launched a failed bid to purchase Swiss-based Syngenta last year.
Should Bayer buy Monsanto, over 60pc of the world’s crop protection and seeds market will be controlled by the major three companies.
The rejection was in line with predictions from business analysts, who said the $US3 a share increase in the offer would not be enough to budge the Monsanto board, which unanimously voted against the proposal.
Although Monsanto is one of the most recognisable brands in agriculture it has had difficulties with its earnings of late, with generic glyphosate taking revenue away from its premium glyphosate based herbicide Roundup.
Monsanto’s shares are currently at $US106.76 or $A140.47.