How can the competition authority allow this to happen?
I don't think it's been agreed yet.
Bayer confirms $66bn Monsanto takeover
11–20 of 77 posts
Re: Bayer confirms $66bn Monsanto takeover
#12Keep in mind that in today's global environment whenever a merger is proposed it has to go through alot of government scrutiny. Not just in the US, but also with the EU and China.
See the Haliburton/Baker Hughes merger that was blown up by the US government.
From a merger arbitrage perspective this has been a very interesting deal. This is the 4th proposal Bayer has made for Monsanto and with an all cash offer this might be enough, again assuming government approval.
They've went from an original offer of $122 to a final offer of $128/share. And the deal includes a breakup fee of $2 Billion for Monsanto if the deal falls through.
Monsanto has played this very well but the $128/share offer represents a 21% bump from yesterday's close, which is a bit concerning. With the other offers that have already been presented such a large premium means the market believes that there is a decent chance that this deal doesn't go through, now most likely due to government interference.
The typical remedy for governments who object to mergers is to have a company sell of a division or twp to show that the new company won't be a defacto monopoly.
Unfortunately in this case there is very little overlap between the two companies. This means that there isn't really anything for Bayer or Monsanto to sell off here.
The newly combined company will own the agricultural space, with a seeds and chemicals integrated vertical that would impress Apple.
Re: Bayer confirms $66bn Monsanto takeover
#13[deleted]
Re: Bayer confirms $66bn Monsanto takeover
#14This won't have negative consequences for the public at all. /s
Zyklon B to buy Agent Orange... Such a nice fit.
Re: Bayer confirms $66bn Monsanto takeover
#15The competition angle isn't what scares me, it's the incentives created by the appearance that Monsanto, an entity whose primary income streams come from utilizing, manipulation, and corrupting the common-sense understanding of IP laws (even unto victimizing farmers who experience pollen drift from nearby farms which use Monsanto products [0]) has generated an exit at over 20% bump in share price.
IMO, the IP legal structure surrounding Monsanto's activities is no different than a direct government subsidy to that company, and given its downright evil actions, I don't think most voters want to subsidize it.
0: https://www.sustainablebusiness.com/index.cfm/go/news.displa...
Re: Bayer confirms $66bn Monsanto takeover
#16Keep in mind that in today's global environment whenever a merger is proposed it has to go through alot of government scrutiny. Not just in the US, but also with the EU and China. See the Haliburton/Baker Hughes merger that was blown up by the US government. From a merger arbitrage perspective this has been a very interesting deal. This is the 4th proposal Bayer has made for Monsanto and with an all cash offer this m…
The ability to create seeds that can only be controlled by your own pesticides and/or medications could be interesting. and scary. Politics aside, can that be an antitrust issue?
[edit: also, is this another "quiet" inversion also? US loses another business for tax purposes?]
Re: Bayer confirms $66bn Monsanto takeover
#17Keep in mind that in today's global environment whenever a merger is proposed it has to go through alot of government scrutiny. Not just in the US, but also with the EU and China. See the Haliburton/Baker Hughes merger that was blown up by the US government. From a merger arbitrage perspective this has been a very interesting deal. This is the 4th proposal Bayer has made for Monsanto and with an all cash offer this m…
The article says The tie-up, which will give the new company control of more than 25% of the world's supply of seeds and pesticides, comes amid a wave of mergers in the agriculture sector.
I'm skeptical that there is any particular public benefit to allowing the merger, but it seems a bit exaggerated to talk about the new entity owning the market.
Re: Bayer confirms $66bn Monsanto takeover
#18Keep in mind that in today's global environment whenever a merger is proposed it has to go through alot of government scrutiny. Not just in the US, but also with the EU and China. See the Haliburton/Baker Hughes merger that was blown up by the US government. From a merger arbitrage perspective this has been a very interesting deal. This is the 4th proposal Bayer has made for Monsanto and with an all cash offer this m…
The ability to create seeds that can only be controlled by your own pesticides and/or medications could be interesting. and scary. Politics aside, can that be an antitrust issue? [edit: also, is this another "quiet" inversion also? US loses another business for tax purposes?]
I would think that you would look at in in terms of the (for example) corn market rather than in terms of the Agglomerated Monster corn market. So the Agglomerated Monster corn would just be a product in the corn market, not a monopoly in the Agglomerated Monster corn market.
Re: Bayer confirms $66bn Monsanto takeover
#19And yet another global industry is now so concentrated that free market forces are fully contained ... What we eat will be decided in Germany and China now. Guten Appetit!
As a European, I don't find it being decided in the US any better.
And that's where most of the companies that make the decisions are...
Re: Bayer confirms $66bn Monsanto takeover
#20>Bayer has been involved in controversies regarding some of its drug products; its statin drug Baycol (cerivastatin) was discontinued in 2001 after 52 people died from renal failure, and Trasylol (aprotinin), used to control bleeding during major surgery, was withdrawn from the markets worldwide when reports of increased mortality emerged; it was later re-introduced in Europe but not in the US.[0]
Can't wait to see what "pharmaceutical" solutions they will bring up together!