Swiss-based Syngenta has rebuffed a second $45 billion purchase offer from U.S.-based Monsanto, calling it “unsolicited” and a “reputational risk.”
Initially, Syngenta cited worries over global regulatory approvals as one of the main reasons behind the first refused offer. And, though Monsanto saw “no legitimate basis for the regulatory concerns” outlined in Syngenta’s refusal, the second offer included a $2-billion reverse break-up fee to Syngenta, in the event that an acquisition was not approved for antitrust reasons within 18 months.
Monsanto has also offered a divestment of Syngenta’s seed and trait business and any overlapping herbicides, to mitigate the risk of regulatory issues. That did little to sway Syngenta’s choice, however.
“Monsanto’s second letter represents the same inadequate price, same inadequate regulatory undertakings to close, same regulatory risks and same issues associated with dual headquarters’ moves,” Syngenta said in a statement.
The parent company would be formed with a new name, said to be based out of the United Kingdom. According to Monsanto, it would “enhance innovation and scale and reach” of both companies, and put more focus into precision agriculture.
“It is disappointing that Syngenta has not engaged in substantive discussions about the many benefits of this combination, including the benefits for farmers around the world,” said Hugh Grant, Monsanto chairman and chief executive officer. “We remain committed to unlocking the opportunity of this combination and pursuing constructive conversation with Syngenta’s management and board.”
The potential new mega-ag corp would have an estimated $31 billion in sales. It’s also been reported that BASF has shown interest in Syngenta, not long after Monsanto’s initial offer. BASF representatives have not commented.