Bayer & Monsanto: Begins $2.5 billion asset sale for Merger Clearance

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Bayer and Monsanto are throwing asset sales worth approximately $2.5 billion seeking clearance for their $66 billion merger. For the upcoming auction process, Bayer’s advisors will provide information to potential bidders for the businesses, which have been put into three different groups of assets.

Both companies stated in the past that they will divest activities with shared sales of up to $1.6 billion. While it was not said what businesses will be put on the auction, antitrust and industry experts anticipates Bayer to possibly strip assets of soybean, cotton and canola seeds, along with LibertyLink-branded crops that are resilient to its glufosinate herbicide.

According to Reuters, regulatory hurdles to the deal are seen as manageable because Bayer’s main business in agriculture is pesticides while Monsanto’s focus is on genetically modified seeds. Bayer said last month that it was on track to clear all regulatory hurdles for the takeover by year-end, including a likely in-depth investigation by the European Union’s competition regulators. Peer BASF has been touted as a potential buyer of some of the assets after abstaining from a wave of consolidation in the agrochemicals industry, which also saw Dow and DuPont merging and ChemChina buying Syngenta. The assets, which comprise sets of different active ingredients in several global regions, will also be shopped to large private equity groups, which may, however, struggle to bid competitively against players in the agricultural supplies market, the sources said.

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