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Bayer is selling off parts of its business to ease concerns of regulators about the impact of its purchase of US rival Monsanto.
Germany's Bayer said Friday it would sell parts of its agrichemical business to rival BASF, kick-starting a competitor in the seeds market even as it clears the way for its mammoth takeover of US-based Monsanto.
Tie-up - Giant - Seeds - Pesticides - Firms
The $66 billion Bayer-Monsanto tie-up would create a world-spanning giant in seeds and pesticides, and the two firms have been mulling concessions to satisfy competition authorities—including the powerful European Commission—closely eyeing the merger plans.
"We are taking an active approach to address potential regulatory concerns, with the goal of facilitating a successful close of the Monsanto transaction," Bayer chief executive Werner Baumann said in a statement.
Friday - Deal - Bayer - Crop - Seeds
Friday's deal will see Bayer sell "essentially all" of its crop seeds units, its glufosinate ammonium herbicide business and related research and development activities and intellectual property to BASF for 5.9 billion euros ($7 billion).
Proceeds from the sale will go towards refinancing the Monsanto bid.
Commission - Month - Hold - Investigation - Bayer-Monsanto
The European Commission said earlier this month it would put on hold its investigation into the Bayer-Monsanto tie-up—the largest merger in German history—to allow the companies time to offer new information.
Environmentalists and politicians on both sides of the Atlantic fear that the deal, which would create a global seeds and pesticides behemoth with annual revenues of around 23 billion euros and 140,000 employees, would give the combined firm too much power over the food chain.
Examination - Tie-up - August - Commission - Concern
As it opened an in-depth examination of the tie-up in August, the Commission expressed concern that Bayer produces one of the few alternatives to Monsanto's product glyphosate, 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.
Bayer still hopes to close its...
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