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Bayer $BAYN and Monsanto $MON to Merge Creating $66B Global Agri-Chem Leader

Bayer $BAYN and Monsanto $MON to Merge Creating $66B Global Agri-Chem Leader

Bayer’s original offer in May of $122 a share. The merger will create a global agriculture leader, while reinforcing Bayer as a Life Science company with a deepened position in a long-term growth industry. Bayer expects annual earnings contributions from total synergies of approximately $1.5 billion after year three. “We are pleased to announce the combination of our two great organizations. This represents a major step forward for our Crop Science business and reinforces Bayer’s leadership position as a global innovation driven Life Science company with leadership positions in its core segments, delivering substantial value to shareholders, our customers, employees and society at large,” said Werner Baumann, CEO of Bayer AG. “Today’s announcement is a testament to everything we’ve achieved and the value that we have created for our stakeholders at Monsanto. We believe that this combination with Bayer represents the most compelling value for our shareowners, with the most certainty through the all-cash consideration,” said Hugh Grant, chairman and chief executive of Monsanto. This transaction would bring together leading Seeds & Traits, Crop Protection, Biologics, and Digital Farming platforms. Specifically, the combined business would benefit from Monsanto’s leadership in Seeds & Traits and Bayer’s broad Crop Protection product line across a comprehensive range of indications and crops. The combination would also be truly complementary from a geographic perspective, significantly expanding Bayer’s long-standing presence in the Americas and its position in Europe and Asia/Pacific. Customers of both companies would benefit from the broad product portfolio and the deep R&D pipeline. Under the proposed transaction, the combined business would provide attractive opportunities for the employees of both companies and have its global Seeds & Traits and North American commercial headquarters in St. Louis, Missouri, its global Crop Protection and divisional Crop Science headquarters in Monheim, Germany, and an important presence in Durham, North Carolina, as well as many other locations throughout the U.S. and around the world. Digital Farming for the combined business would be based near San Francisco, California. Bayer intends to finance the transaction with a combination of debt and equity. The equity component of approximately USD 19 billion is expected to be raised through an issuance of mandatory convertible bonds and through a rights issue with subscription rights. Bridge financing for USD 57 billion is committed by BofA Merrill Lynch, Credit Suisse, Goldman Sachs, HSBC and JP Morgan. The combined agriculture business will have its global Seeds & Traits and North American commercial headquarters in St. Louis, Missouri, its global Crop Protection and overall Crop Science headquarters in Monheim, Germany, and an important presence in Durham, North Carolina, as well as many other locations throughout the U.S. and around the world. The Digital Farming activities for the combined business will be based in San Francisco, California. The acquisition is subject to customary closing conditions, including Monsanto shareholder approval of the merger agreement and receipt of required regulatory approvals. Closing is expected by the end of 2017. BofA Merrill Lynch and Credit Suisse are acting as lead financial advisors and structuring banks to Bayer in addition to providing committed financing for the transaction; Rothschild has been retained as an additional financial advisor to Bayer. Bayer’s legal advisors are Sullivan & Cromwell LLP (M&A) and Allen & Overy LLP (Financing). Morgan Stanley & Co. and Ducera Partners are acting as financial advisors, and Wachtell, Lipton, Rosen & Katz is acting as legal advisor to Monsanto. Bayer is a global enterprise with core competencies in the Life Science fields of health care and agriculture. Its products and services are designed to benefit people and improve their quality of life. At the same time, the group aims to create value through innovation, growth and high earning power. Bayer is committed to the principles of sustainable development and to its social and ethical responsibilities as a corporate citizen. In fiscal 2015, the group employed around 117,000 people and had sales of EUR 46.3 billion. Capital expenditures amounted to EUR 2.6 billion, R&D expenses to EUR 4.3 billion. Bayer AG was founded in 1863 and is headquartered in Leverkusen, Germany. Monsanto provides agricultural products for farmers worldwide. It operates in two segments, Seeds and Genomics, and Agricultural Productivity. The Seeds and Genomics segment produces raw crop seeds, including corn, soybean, cotton, and canola seeds under the DEKALB, Channel, Asgrow, and Deltapine brands; and vegetable seeds, such as tomato, pepper, melon, cucumber, squash, beans, broccoli, onions, lettuce, and others under the Seminis and De Ruiter brands. It also develops biotechnology traits that assist farmers in controlling insects and weeds in corn, soybean, cotton, and canola crops under the SmartStax, YieldGard, YieldGard VT Triple, VT Triple PRO, and VT Double PRO brands; and Intacta RR2 PRO, and Bollgard and Bollgard II, as well as Roundup Ready and Roundup Ready 2 Yield, and Genuity brands. This segment also licenses a range of germplasm and trait technologies to large and small seed companies. The Agricultural Productivity segment manufactures and sells herbicides for agricultural, industrial, ornamental, turf, and residential lawn and garden applications for weed control, as well as for control of preemergent annual grass and small seeded broadleaf weeds in corn and other crops under the Roundup and Harness brands. The company markets its products through distributors, independent retailers and dealers, agricultural cooperatives, plant raisers, and agents, as well as directly to farmers. Monsanto Company has a collaborative agreement with Novozymes to discover, develop, and produce microbial solutions. The company was formerly known as Monsanto Ag Company and changed its name to Monsanto Company in March 2000. Monsanto was founded in 2000, it has more than 20,000 employees, and is headquartered in St. Louis, Missouri.]]>

@LandOLakesInc Scoops Up PE-Backed Agri-BioTech Pioneer Ceres $CERE for $17.2M

@LandOLakesInc Scoops Up PE-Backed Agri-BioTech Pioneer Ceres $CERE for $17.2M

Land O’ Lakes Inc., one of America’s premier agribusiness and food companies, agreed to acquire Californian agricultural biotech and plant genomics pioneer Ceres Inc. (NASDAQ: CERE) for $17.2 million in cash. The offer price of $0.40 per share, represents an 81% premium to yesterday’s $0.22 closing price of Ceres shares. In December 2015, Ceres raised $7.6 million through a public offering priced at $0.40 per share, with net proceeds of $6.4 million. In February 2012, Ceres completed its initial public offering priced at $13.00 per share, and raised $65 million. Prior to its IPO, Ceres had raised $95 million in two private equity rounds. At the time of its IPO, the largest shareholders were global private equity firms Warburg Pincus, Artal Luxembourg, Ambergate Trust and Oxford Bioscience, while biotechnology company Monsanto (NYSE: MON), which Germany’s Bayer AG (ETR: BAYN) agreed to acquire a few weeks ago for $62 billion, had a 4.8% stake in Ceres. At closing Ceres will become a wholly owned subsidiary of Land O’Lakes and will complement Forage Genetics International (FGI), a Land O’Lakes subsidiary, bringing advanced new plant breeding and biotechnology to FGI’s research and development pipeline.

Land O’Lakes is a member-owned cooperative with industry-leading operations that span the spectrum from agricultural production to consumer foods, with 2015 annual sales of $13 billion. In comparison, Monsanto generated $15 billion in revenue in 2015. As a result, “the deal with Ceres could potentially catapult overnight the legendary Land O’Lakes coop and its Forage Genetics International business into a publicly traded agricultural biotech giant, virtually on the scale of Monsanto,” says ExitHub’s CEO Norbert Mehl.
“Through our Forage Genetics International business, Land O’Lakes is interested in providing a holistic forage offering to our customers, including alfalfa, corn silage and forage sorghum. The acquisition brings complementary strengths together, adds new advanced plant breeding and biotechnology to the FGI research and development pipeline and accelerates the process of bringing new forage solutions to existing and new markets,” said Land O’Lakes president and CEO Chris Policinski. “Our shift away from bioenergy and Brazil and into forages has been highly successful to date, and is culminating now in this proposed merger transaction with a preeminent leader in forage crops,” said Ceres CEO and president Richard Hamilton. “After evaluating strategic options, our board of directors has unanimously determined that this all-cash transaction, which represents a significant premium from recent trading levels, is in the best interest of the company and its stockholders, and will advance Ceres’ mission of making the production of meat and dairy more scalable and sustainable.” Upon the closing of the transaction, holders of certain warrants to purchase shares of Ceres common stock will be entitled to payments of approximately $6.1 million, in the aggregate. The transaction, which has been approved by the Land O’Lakes board of directors and unanimously approved by the Ceres board of directors, is expected to close in the third calendar quarter of 2016. Land O’Lakes will fund the transaction with cash on hand. The transaction is not subject to any financing contingency. Closing of the tender offer and merger is subject to customary conditions. Ceres is an agricultural biotechnology company that develops and markets seeds and traits to produce crops for animal feed, sugar and other markets. The company’s advanced plant breeding and biotechnology platforms, which can increase crop productivity, improve quality, reduce crop inputs and improve cultivation on marginal land, have broad application across multiple crops, including food, feed, fiber and fuel crops. Ceres markets its seed products under its Blade brand. The company also licenses its biotech traits and technology to other life science companies and organizations. Ceres was founded in 1996, it has 44 employees, and is headquartered in Thousand Oaks, California. Land O’Lakes is one of the nation’s largest cooperatives. Building on a legacy of more than 94 years of operation, Land O’Lakes today operates some of the most respected brands in agribusiness and food production including LAND O LAKES Dairy Foods, Purina Animal Nutrition and WinField. The company does business in all 50 states and more than 60 countries. Land O’Lakes’ headquarters are in Arden Hills, Minnesota.]]>