If the deal closes between German-based Bayer and Monsanto, it will create the world’s largest seed and crop protection company, according to AgWeb. But the merger will be required to undergo an intense and lengthy regulatory process by Monsanto shareholders, the EU and U.S. anti-trust regulators.
Bayer says it will purchase Monsanto for $66 billion, or $128 per share, ending months-long negotiations and discussions between the two companies.
The final offer, which Monsanto has accepted, is $4 billion more than Bayer had initially offered.
There has been a large wave of agribusiness consolidation amid tough agricultural conditions and a struggling farm economy. This announcement comes after the approval of Syngenta ChemChina acquisition and proposed mergers between Dow/DuPont and Potash Corp./Agrium, according to Farm Futures.
The American Farm Bureau Federation (AFBF) says the Department of Justice should “undertake a close review of the overall business climate” that has led to these consolidations.
“Market forces led to deals like the one announced, but we know that major-company mergers have a profound impact on the tools available to farmers and ranchers, sometimes to their detriment,” AFBF Chief Economist Bob Young said in a statement.
The impact the trend in merger deals has on farmers and ranchers, research and product development, innovation and competition must be scrutinized and carefully evaluated.
“Farmers and ranchers, in particular, are interested in how these deals will impact research and development budgets for companies like Bayer and Monsanto,” Young said. “We depend on access to enhanced technology and would hate to see agricultural innovation suffer at the cost of business decisions.”