Bayer AG is proposing an increased offer and break fee as it tries to clinch the acquisition of Monsanto Co. to create the world’s biggest maker of seeds and pesticides, according to people familiar with the matter. The huge buyout in agriculture industry will change the original industry layout. Roughly a $60 billion buyout offer will not only put problems on the management but also tasks for regulators.
Bayer is willing to raise its offer to about $129 a share, or $56.5 billion, from $127.50 a share, and double the antitrust break fee to about $3 billion, said the people, who asked not to be identified because the deliberations are private.
Monsanto’s management board is scheduled to discuss and potentially approve the proposal Tuesday, the people said. Bayer’s supervisory board is set to review the deal Wednesday, and an announcement could come shortly thereafter, the people said. Talks may still fall apart.
The bid is 21 percent above Monsanto’s closing price on Monday in New York. If successful, it would lead to the biggest deal this year and the largest ever by a German company. Monsanto shares fell 60 cents to $106.40 in New York trading at 2:40 p.m. Bayer declined 0.3 percent to close at 93.30 euros in Frankfurt, valuing the company at 77.2 billion euros ($86.6 billion).
Bayer’s wooing of Monsanto has played out against a backdrop of a rapidly consolidating crop and seed industry, with a series of big deals threatening to leave just a few global players. China National Chemical Corp. agreed in February to acquire Syngenta AG, while DuPont Co. and Dow Chemical Co. plan to merge and then carve out a new crop-science unit.
Spokesmen for both companies declined to comment on the new proposal, which was reported earlier by local German newspaper Rheinische Post.