Germany's Bayer has raised its offer for Monsanto to $65bn, or $127.50 a share, and says that negotiations to create the world's biggest agricultural seeds supplier are advancing. But will it be enough to seal a deal? David Pollard reports.
This is a deal Bayer is desperate not to let slip away. A tie-up with Monsanto seen as a must to battle against tumbling commodity prices. For Bayer, it's now worth a new record 65 billion dollar all-cash offer. That equating to 127 dollars 50 a share - up from 125 dollars. The two chief execs of the two companies reportedly in direct discussions on how to create the world's biggest agricultural supplier. Monsanto rebuffed two previous offers. But with others in the sector already tying the knot, the pressure's on. ChemChina and Syngenta agreed earlier this year on a 43 billion dollar deal - Dow Chemicals and DuPont are in the throes of a 130 billion dollar merger. (SOUNDBITE) (English) CMC MARKETS ANALYST, JASPER LAWLER, SAYING: "ChemChina paid a much bigger premium for Sygenta than even this proposed higher bid of 127 dollars 50 cents a share and so I think with that in mind it's still not quite enough, and we're probably looking at a more prolonged process and a higher price being necessary to actually get the thing done." A combined Bayer/Monsanto could face regulatory hurdles for their control over the global seeds market. But Bayer - perhaps better known for its healthcare than its agro products - says the current talks are 'advanced'. Though some reports say only at 130 dollars a share would the deal finally become sweet enough to tempt Monsanto.