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Senate panel to scrutinize proposed Bayer-Monsanto merger


Bayer Monsato

In the short term, the German drugs and chemicals firm hopes to benefit from a marketing and sales force that can promote combinations of the two groups’ existing products. For example, DuPont and Bayer are leaders in crop protection while Dow and Monsanto are among the market leaders in traits.

The chefs, who included the Argentina-born Mauro Colagreco, who runs the Mirazur restaurant on the French Riviera which was named the sixth best restaurant in the world earlier this year, said the European Union was right to be anxious by the merger.

The organizations joining the call to block these mega-mergers include SumofUs, Food Water Watch, Sierra Club, Pesticide Action Network, Friends of the Earth, Center for Food Safety, Organic Seed Alliance, Rural Advancement Foundation International and Clif Bar Family Foundation/Seed Matters. Though Bayer has also faced criticism from environmentalists, it’s perhaps best known as the company that brought Aspirin to market, in 1899. Organic farmers in particular are already underserved by the industry because the dominant players only invest in seed technologies and chemical production systems that are in conflict with organic farming practices. Finally, the deal was signed at United States dollars 128 a share. There’s concern that research will be consolidated and fewer research paths will be tested.

Mr. Baumann also said he was “very confident” about the company’s pipeline of new drugs. “What you have with an integrated offering is the promise of an optimal outcome”. Monsanto’s board of directors and Bayer’s board of management and supervisory board unanimously approved it. Analysts at Deutsche Bank and Jefferies have warned the financial burden could drain funding from Bayer’s pharmaceutical business, which is struggling to sustain the rate of past blockbuster drug launches.

On July 20, shareholders at Dow Chemical and DuPont agreed to a $59 billion merger that would bring under one umbrella two of the largest U.S. chemical makers. Another possibility is what economists call “winner’s curse”, namely that the victor of an auction or contest or bidding war tends to be the person or institution most optimistic, and in fact overly optimistic, about the value at stake.

Mr. Zaruk said smaller seed and crop companies in Europe mostly have been priced out of the market and must team up with multinationals to get their products out because of the hundreds of millions of euros it can cost to comply with regulatory standards. The combined company will be well positioned to participate in the agricultural industry with significant long-term growth potential.

“It’s the ideal match”, Blome said of the Monsanto deal.

“It’s going to take a lot of innovation to ensure that everybody can be fed”, and the combined company will be able to speed up product improvements to help, Liam Condon, head of Bayer Crop Science, told The Associated Press.

“Consolidation in the industry is a prerequisite to further investment in RD”, he added. Biotechnology represents one of the key platform sectors for development where advances in agriculture, chemical and medical research could be effectively merged; thus, Turkish entrepreneurs must more aggressively expand into this area. He spoke on condition of anonymity.

Blome noted that Monsanto has a greater presence in North America while Bayer’s business is greater outside of North America.