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Bayer to close Monsanto deal this week

Monsanto name to be dropped

Reuters

Bayer’s Monsanto deal is valued at $63 billion.
Reuters Bayer’s Monsanto deal is valued at $63 billion.

Bayer is days away from a transformation into the world’s biggest maker of seeds and agricultural chemicals, saying it plans to close its purchase of Monsanto this week.

Bayer will retain its name and drop Monsanto’s as it closes the deal Thursday while raising as much as $30 billion in shares and bonds.

The purchase is part of a multiyear transformation, as Bayer sold off its legacy plastics business and remade itself into a life-science company with roughly half its sales from medicines and half from agriculture.

It’s the third in a series of megadeals in the industry, following Dow Chemical’s merger with DuPont and China National Chemical Corp.’s takeover of Syngenta.

“We are about to close the transaction,” CEO Werner Baumann said on Monday.

He didn’t rule out further portfolio changes, saying in a news conference that the Leverkusen, Germany-based company will continue to “actively manage” its units. “If you stand still, you will fall back,” he said.

The deal will double the size of Bayer’s agriculture business.

The total deal is valued at $63 billion.

To gain approval for the deal from the U.S. Department of Justice, Bayer agreed to sell assets to BASF. The divestiture package is worth about $9 billion, the largest in a U.S. merger-enforcement case, the government said.

The integration is scheduled to start once the BASF sale has been completed, probably about two months from now.

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