On Thursday, German chemical and pharmaceutical company Bayer rose its bid for U.S. seed company Monsanto Company (NYSE: MON) by $3 per share to $125, saying the move followed several weeks of private talks between the pair.
According to Bayer’s statement on Thursday, the company made the new tender offer verbally on July 1 and more formally eight days later. The total takeover bid for Monsanto is up to approximately $65 million. Bayer also had said the proposal didn’t address potential financing and regulatory risks.
Following private talks over the past several weeks, Bayer said it has comprehensively fixed Monsanto’s concerns. Also, the company mentioned that it is prepared to make certain commitments to regulators to complete the proposed acquisition, if required. Bayer said that it is also offering a $1.5 billion “reverse antitrust break fee” to reflect its confidence in securing a successful deal.
“We are convinced that this transaction is the best opportunity available to provide Monsanto shareholders with highly attractive, immediate and certain value,” Bayer CEO Werner Baumann said in a statement. “Bayer is fully committed to pursuing this transaction.”
In May, Bayer offered to takeover Monsanto for total amount of $62 billion, includes debt. In a statement, Bayer said it “believes that its offer fully captures the intrinsic value of Monsanto,” adding that the new bid represents a 40% premium to Monsanto’s share price in early May. A number of analysts have said they see Monsanto’s fair valuation in a per-share range of $130 to $140.