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Monsanto shareholders approve Bayer’s $57-billion takeover

Monsanto makes Roundup weed killer, as well as seeds for fruits, vegetables, corn, soybeans, cotton and other crops.
(Jeff Roberson / Associated Press)

Monsanto Co. shareholders on Tuesday overwhelmingly approved a $57-billion takeover by Bayer, a deal that would combine two of the world’s biggest agricultural companies.

But the path toward securing regulatory approval may be rough. Critics say the combination would shrink competition in the agricultural market, drive prices higher for farmers and consumers and escalate damage to the environment. Monsanto and Bayer officials say that growers and ranchers stand to benefit, and that the combined company would be better suited to address issues like climate change.

Preliminary results showed that 99% of the votes cast favored the deal announced in September, St. Louis-based Monsanto said. Shareholders are to receive $128 per share in cash. Monsanto said the deal, which must still receive regulatory approval, is expected to close by the end of 2017.

Monsanto shares declined 7 cents to $104.52.

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“This is an important milestone as we work to combine our two complementary companies and deliver on our shared vision for the future of agriculture,” Monsanto Chairman and Chief Executive Hugh Grant said in a statement.

Bayer, the German medicine and farm-chemical maker, and Monsanto — which sells seeds, herbicides and pesticides, among other agricultural products — have faced concern from some government and agriculture industry leaders who worry that if the companies combine, it would hurt farmers by reducing competition at a time when the agriculture economy has slowed.

The National Farmers Union has said the deal would mean three companies would have more than 80% of U.S. corn seed sales and 70% of the global pesticide market.

The vote “underscores NFU’s concern that these megadeals are being made to benefit the shareholders of multinational corporations at the expense of family farmers, ranchers, consumers and rural economies,” Roger Johnson, president of the National Farmers Union, said in a statement.

Both the farmers union and the Natural Resources Defense Council urged the U.S. Department of Justice to reject the deal.

“Consolidating Monsanto and Bayer would escalate the use of dangerous toxic pesticides and create a bad deal for farmers, bees, consumers and the planet,” Rebecca Riley, senior attorney for the NRDC, said in a statement.

Top officials for both companies say the merger would be a boost for farmers and the environment.

“By bringing together our expertise and our resources to drive this shared vision, we can do even more together to benefit growers around the world and to help address broad global challenges like climate change and food scarcity,” Grant said.

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Werner Baumann, CEO of Bayer, said the acquisition of Monsanto “is driven by our strong belief that this combination can help address the growing challenges facing farmers and the overall agriculture industry today and in the future. Together, Bayer and Monsanto will be able to offer the new, innovative solutions that our customers need.”

The deal calls for Bayer to pay $57 billion to Monsanto shareholders and assume $9 billion in Monsanto debt.

Bayer sells crop protection chemicals used to kill weeds, insects and plant fungal diseases, and it makes popular pharmaceutical products such as Bayer aspirin, Claritin allergy medicine and Alka Seltzer. Bayer also owns Dr. Scholl’s foot products and Coppertone sunscreen.

Monsanto sells seeds for fruits, vegetables, corn, soybeans, cotton and other crops, plus Roundup weed killer. The company is a leading producer of genetically modified seeds engineered to resist drought and herbicides, among other things. Protests against Monsanto by opponents of genetically modified organisms, or GMOs, are common.

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Plans call for the combined company’s seeds and North American business to be headquartered at Monsanto’s St. Louis base. Executives for both companies have not said whether the Monsanto name would change.


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