Monsanto has finally agreed to be purchased by Bayer AG in a historic $66 billion all-cash takeover. The agreement, which both corporations have confirmed, will form the largest seed and pesticide company in the world.

The German pharmaceuticals and chemicals giant had been courting the St. Louis-based seed maker for roughly four months, with the aspirin-maker sweetening the pot with ever-growing sums of money. Bayer finally plans to pay $128 a share for Monsanto, up from its initial May offer of $122 a share.



Not only is this the largest foreign corporate takeover ever by a German firm, it's the largest cash bid on record, as Reuters reported. A successful merger would create the world's largest agrichemical firm, which will control more than one-fourth of the combined global market for seeds and pesticides.

According to Bloomberg, "The deal gives Bayer more than 2,000 varieties of seeds for crops such as corn, soybeans, and wheat. Adding that portfolio to its own vegetable, rice, cotton and oilseed offerings give Bayer a virtually unassailable position at the head of the market."

The Monsanto-Bayer combination is yet another example of the rapidly consolidating agricultural industry, with only a handful of companies controlling the sector. Alongside slumping crop prices, DuPont Co. and Dow Chemical Co. have agreed to merge, as did China National Chemical Corp. and Syngenta AG.

Bayer CEO Werner Baumann and Monsanto Chairman and CEO Hugh Grant, appeared in a joint announcement of the proposed combination on their "Advancing Together" website. In their statements, both chiefs echoed Big Ag's oft-repeated sentiment that biotechnology helps increases crop yields in an environmentally friendly way and is one solution to feeding a growing global population.

"We are fully committed to helping solve one of the biggest challenges of society, and that is how to feed a massively growing world population in an environmentally sustainable manner," Baumann said. "What we do is good for consumers. We help produce efficient, safe, healthy and affordable food. It is also good for our growers because they have better choices to increase yields in a sustainable way."

Dave Murphy, the executive director of Food Democracy Now!, refutes this belief. "Agricultural biotechnology has never been about 'feeding the world,' but enriching the bottom line of toxic chemical corporations that have had a long history of producing chemicals that are deadly to human populations and the environment," he told EcoWatch.

Monsanto, the world's largest producer of genetically modified (GMO) crops and maker of the glyphosate-based herbicide Roundup, has faced mounting controversy and numerous lawsuits in recent years over the health and environmental impacts of its products.

Bayer has also been subject to criticism over its widely used insecticide, imidacloprid, which belongs to a controversial class of chemicals called neonicotinoids that's linked to widespread deaths of pollinators.

On today's landmark news, Murphy said: "Now the most evil company in Europe has absorbed the most evil company in America. Monsanto and Bayer's new corporate motto should be 'Killing bees and butterflies for fun and profit.'"

The Monsanto takeover is an interesting move for the German company. Although GMOs are widely grown in the U.S. and in other countries, the topic is fraught with contention in Europe. Many European Union countries have strict laws against GMOs due to public health and environmental concerns. Germany itself discourages the cultivation of GMO crops.

The BBC reported that farming groups are concerned that the deal could lead to fewer choices and higher prices for farmers.

"Bayer's acquisition of 'Frankenstein' crop producer Monsanto could be a horror story for both Bayer and its customers: the farmers," professor John Colley of Warwick Business School in England told the publication. "The farmers will lose out as product ranges are rationalized and attempts are made to increase prices."

Several consumer advocates and environmental organizations have denounced the acquisition for similar reasons.

"Today, Bayer announced it has agreed to buy Monsanto, another devastating merger that's bad for farmers, the environment and consumers," Wenonah Hauter, the executive director of Food & Water Watch, said. "Consolidation in the agrochemical industry means that farmers get paid less for their crops, more pesticides are used and there are fewer options for consumers at the grocery store. It's past time for the Department of Justice to do its job and enforce anti-trust measures to support healthy competition in the ag industry."

"With this deal Big Biotech gets bigger; it means monopoly power for Bayer-Monsanto, just like the previous mergers of Dow and DuPont and Syngenta and ChemChina," Ken Roseboro, the editor and publisher of The Organic & Non-GMO Report, told EcoWatch. "These three companies will dominate the global seed and pesticide markets and will likely drive up costs for farmers. The Justice Department should stop these mergers because they are bad farmers, bad for agriculture, and bad for consumers."



Critics of the tie-up have noted that Monsanto's poor image was a factor in its decision to be bought.



"The merger of Bayer and Monsanto should make the connection between Big Pharma, Big Biotech and Big Food all the more apparent to consumers," Ronnie Cummins, the international director of the Organic Consumers Association, told EcoWatch. "This may be a move to take pressure off the manufacturer of glyphosate, the most profitable pesticide in the world. But it really doesn't matter who manufactures or sells glyphosate, or any other dangerous chemical. The damage to human health and the environment remains the same, as does our commitment to getting these chemicals out of our food system."



Dr. Vandana Shiva, the executive director of the Navdanya Trust, recently wrote about the controversial histories of both companies.

"MoBay supplied ingredients for Agent Orange in the Vietnam War. Around 20 million gallons of MoBay defoliants and herbicides were sprayed over South Vietnam. Children are still being born with birth defects, adults have chronic illnesses and cancers, due to their exposure to MoBay's chemicals," she wrote. "Monsanto and Bayer's cross-licensed Agent Orange resistance has also been cross-developed for decades. Wars were fought, lives lost, nations carved into holy lands — with artificial boundaries that suit colonization and resource grab—while Bayer and Monsanto sold chemicals as bombs and poisons and their brothers provided the loans to buy those bombs."

"More recently, Bayer CropScience AG and Monsanto are believed to have entered into a long-term business relationship," Shiva continued. "This gives Monsanto and Bayer free access to each other's herbicide and paired herbicide resistance technology. Through cross-licensing agreements, mergers and acquisitions, the biotech industry has become the I.G. Farben of today, with Monsanto in the cockpit."

Monsanto and Bayer intend to file relevant materials with the U.S. Securities and Exchange Commission. Analysts are now turning their attention to the legality of the purchase and whether or not it could escape regulatory hurdles. Bayer, which expects to close the deal by the end of 2017, will pay Monsanto a break-up fee of $2 billion if the deal is not completed.



According to Reuters, Bernstein Research analysts believe that the merger has only a 50 percent chance of securing regulatory clearance. However, they cited a survey among investors that pushed the likelihood to roughly 70 percent.

"We believe political pushback to this deal, ranging from farmer dissatisfaction with all their suppliers consolidating in the face of low farm net incomes to dissatisfaction with Monsanto leaving the United States, could provide significant delays and complications," they wrote in a research note.

Meanwhile, Monsanto's tribunal at The Hague next month is still on deck. The Organic Consumers Association, IFOAM International Organics, Navdanya, Regeneration International and Millions Against Monsanto, joined by dozens of global food, farming and environmental justice groups are putting the transnational corporation on trial for crimes against nature and humanity and ecocide.

"The proposed buyout of Monsanto by Bayer does nothing to alter or weaken the upcoming Monsanto Tribunal, which will take place Oct. 15-16 in The Hague," Cummins said. "The buyout won't be completed by then. More important, the advisory opinions that will be issued by the five international judges will be applicable to all agribusiness companies, including Bayer."

