Business

Syngenta rejects $45B offer from agricultural rival Monsanto

Syngenta, a Swiss-based buyer of seeds and agricultural chemicals, has rejected a second buyout offer from rival Monsanto valued at more than $45 billion.

Farmers worry about loss of competition in agricultural seeds and chemicals business

Monsanto agribusiness greenhouses on top of a research building in St Louis, Missouri, are used to create new varieties of seeds. Its offer for Swiss-based Syngenta was $45 billion. (Brent Stirton/Getty Images)

Syngenta, a Swiss-based buyer of seeds and agricultural chemicals, has rejected a second buyout offer from rival Monsanto valued at more than $45 billion.

Syngenta argued the offer undervalues the company and would be subject to anti-trust rulings that could ultimately hurt the value of both companies.

Monsanto sees the merger as a chance to shift its headquarters out of the U.S. and settle into a lower-tax U.K. base. It also said it would sell off Syngenta's seeds business and rationalize lines of agricultural chemicals if it acquired its rival.

The second offer added a $2 billion reverse breakup fee, intended to cover the costs if Syngenta was unable to get global regulatory approvals for the deal.

Now Monsanto is hoping to push the deal through by wooing Syngenta shareholders.

The deal, presented Saturday, offered $489.84 per Syngenta share, which Monsanto says is a 43 per cent premium on the April share prices of the Swiss company.

Meanwhile, U.S. farmers have expressed concern that the deal would reduce competition in the agricultural sector and boost prices.

Monsanto already uses its size and legal clout to prevent labelling of genetically modified foods and control seed patents.

It has expressed "disappointment" that Syngenta has not responded positively to its overtures.

"It is disappointing that Syngenta hasn't engaged in substantive discussions about the many benefits of this combination, including the benefits for farmers around the world," said Hugh Grant, Monsanto's chief executive, in a statement Sunday.

With files from the Associated Press

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.

Become a CBC Member

Join the conversation  Create account

Already have an account?

now