USA: Monsanto Takeover Bayer Receives Approval for Acquisition of Monsanto from US Department of Justice
Bayer obtained conditional approval from the Antitrust Division of the United States Department of Justice (DOJ) for the proposed acquisition of Monsanto. However, the approval is tied to significant divestment conditions.
Leverkusen/Germany — The German company has now obtained almost all clearances which are conditions for closing the transaction. The company said in a statement that it expects to receive any outstanding approvals required for completing the transaction very shortly.
Bayer will become the sole shareholder of Monsanto following the receipt of outstanding approvals. According to the DOJ’s conditional approval, the integration of Monsanto into Bayer can take place as soon as the divestments to BASF have been accomplished. This is expected to be in approximately two months.
In a separate statement, the Department of Justice announced that it is requiring Bayer to divest businesses and assets collectively worth approximately $ 9 billion in order to proceed with its proposed $ 66 billion acquisition of Monsanto. The proposed divestiture to BASF would fully resolve all horizontal and vertical competition concerns, the Department said.
Under the terms of the proposed settlement, Bayer must divest those businesses that compete with Monsanto today. These include the company’s cotton, canola, soybean, and vegetable seed businesses, as well as their Liberty herbicide business, a key competitor of Monsanto’s Roundup herbicide. The settlement also requires structural divestitures to remedy the competitive harm that would result from the vertical integration of certain significant seed treatment businesses with Monsanto’s leading seed businesses.
Finally, in order to fully prevent competitive harm from the merger, the settlement requires the divestiture of additional complementary assets that are needed to ensure that BASF has the same innovation incentives, capabilities and scale that Bayer would have as an independent competitor including, most notably, the nascent “digital agriculture” business.