BASF has agreed to acquire significant parts of Bayer’s seed and non-selective herbicide businesses – including Liberty herbicide and traits and the Stoneville and FiberMax cotton seed brands – in a cash deal worth 5.9 billion euros ($7 billion).
Bayer intends to divest these assets as part of its planned acquisition of Monsanto. The transaction is subject to the closing of the Bayer/Monsanto deal – expected in the first quarter of 2018 – and approval by relevant authorities.
“We are taking an active approach to address potential regulatory concerns, with the goal of facilitating a successful close of the Monsanto transaction,” explained Werner Baumann, chairman of the Board of Management of Bayer AG. “We are pleased that, in BASF, we have found a strong buyer for our businesses that will continue to serve the needs of growers and offer our employees long-term prospects.”
“With this investment, we are seizing the opportunity to acquire highly attractive assets in key row crops and markets,” said Dr. Kurt Bock, chairman of the Board of Executive Directors of BASF SE. “It will be a strategic complement to BASF’s well-established and successful crop protection business, as well as to our own activities in biotechnology.”
Assets involved in the agreement include Bayer’s global glufosinate-ammonium business and the related LibertyLink technology for herbicide tolerance, essentially all of the company’s field crop seeds businesses, as well as respective research and development capabilities. The seeds businesses being divested include the global cotton seed business (excluding India and South Africa), the North American and European canola seed businesses and the soybean seed business.
The transaction includes the transfer of relevant intellectual property and facilities, as well as more than 1,800 employees located primarily in the United States, Germany, Brazil, Canada and Belgium. As part of the agreement, BASF has committed to maintain all permanent positions, under similar conditions, for at least three years after closing of the transaction.
The acquisition complements BASF’s crop protection business, strengthening the company’s herbicide portfolio and marking its entry into the seed business with proprietary assets in key agricultural markets.
“Building on the competent new team members and the enhanced portfolio, we will offer farmers a greater choice of solutions addressing their needs for high-quality seeds, chemical and biological crop protection,” explained Saori Dubourg, member of the Board of Executive Directors of BASF SE responsible for the Agricultural Solutions segment. “Moreover, this transaction will create new opportunities for future growth and strengthen our global innovation potential.”
Bayer will continue to own, operate and maintain these businesses until the closing of this divestiture. After the closure of the planned Monsanto acquisition, Bayer will continue to be active in these same areas as a result of Monsanto’s current programs, products and offerings.
Sources – BASF, Bayer