BAYER BID

Even Monsanto Has its Price

ARCHIV - Ein Landwirt fährt am 22.04.2016 mit einem Traktor und angehängter Drille über ein Feld nahe Petersdorf im Landkreis Oder-Spree (Brandenburg) und bringt Maissaat in den Boden. Wo neue Straßen, Siedlungen oder Supermärkte gebaut werden, muss anderswo ökologischer Ausgleich geschaffen werden, so sieht es das Naturschutzgesetz vor. Landwirten ist diese Regelung schon lange ein Dorn im Auge. Foto: Patrick Pleul/dpa (zu dpa vom 29.05.2016) +++(c) dpa - Bildfunk+++
Farmers worry Bayer's bid will change the seed market.
  • Why it matters

    Why it matters

    Bayer’s risky bid for agrochemical giant Monsanto has raised eyebrows on both sides of the Atlantic. But both management teams see value in the proposed merger.

  • Facts

    Facts

    • Bayer recently launched a $62 billion takeover bid for Monsanto, in what would be the largest-ever German corporate acquisition.
    • The bid came as a surprise, since Bayer CEO Werner Baumann only took his post on May 1.
    • Monsanto rejected the initial offer, but its stock price has subsequently risen by 10 percent. Bayer shares have fallen by about the same amount.
  • Audio

    Audio

  • Pdf

If you want to find the real heart of agrochemical giant Monsanto, go to Chesterfield, on the outskirts of St. Louis.

Chesterfield is where hundreds of scientists work in the 250 laboratories and 125 “growth chambers” of the company’s massive research center, close to the confluence of the Missouri and Mississippi rivers.

In these growth chambers, light, temperature and humidity are carefully controlled to imitate the world’s climate zones, helping Monsanto develop new hybrids and genetically modified plant life.

It’s no coincidence that company’s headquarters are in St. Louis. The declining city may only only have 300,000 inhabitants but it remains one of the few population centers in America’s “Grain Belt.” From here, enormous fields stretch into the prairie. And like suppliers around a car factory, small biotech companies cluster around Monsanto and its Chesterfield Village Research Center – 700 ancillary firms employ 15,000 people in St. Louis, a major contribution to the local economy.

For Bayer, the German chemical and pharmaceutical company bidding to take over Monsanto, the research center is a major attraction, as is the seed know-how that goes with it. This week, Bayer bid $62 billion dollars for Monsanto, a lot of money for a company with only $15 billion in turnover. Nonetheless, Hugh Grant, Monsanto’s president and CEO, rejected the offer as “significantly too low,” although he did say a merger could bring “substantial advantages.”

Want to keep reading?

Subscribe now or log in to read our coverage of Europe’s leading economy.