EU opens probe into Bayer’s $ 66 b takeover of Monsanto

Wednesday, 23 August 2017 00:00 - - {{hitsCtrl.values.hits}}

AFP: The European Commission said Tuesday it was opening an in-depth investigation into the proposed $ 66-billion (56-billion-euro) takeover of US seed and pesticide supplier Monsanto by Germany’s Bayer, citing concerns it may reduce competition in key products for farmers.

“Seeds and pesticide products are essential for farmers and ultimately consumers,” said EU Competition Commissioner Margrethe Vestager.

“We need to ensure effective competition so that farmers can have access to innovative products, better quality and also purchase products at competitive prices.”

After a months-long pursuit in which it raised its offer price several times, Bayer won over Monsanto’s management in September 2016 for the buyout that would create the world’s largest integrated pesticides and seeds company.

But the deal has provoked criticism from environmental groups, because of Monsanto’s long history of promoting genetically modified crops.

The European Commission expressed concern that Bayer produces one of the few alternatives to Monsanto’s product glyphosate, which it said is the most sold non-selective herbicide in Europe.

It also noted that both firms have large market shares in vegetable seeds and several field crops where their products compete against one another.

The European Commission also said Bayer was one of the few competitors to Monsanto in several markets for developing traits in plants, such as tolerance to herbicides.

It said the two companies made commitments to address some of its concerns in July.

“However, the Commission considered these commitments insufficient to clearly dismiss its serious doubts as to the transaction’s compatibility with the EU Merger Regulation,” it said in a statement.

The commission said it would take a decision on the merger by next 8 January.