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The acquisition was approved, however, under strict conditions. Bayer will have to sell off parts of its business worth almost 9,000 million dollars.
The competition authorities of the United States authorized this Tuesday (29.05.2018) the German pharmaceutical and chemical giant Bayer to acquire the US seed company Monsanto, but established strict conditions, the Justice Department reported.
To obtain approval, the German company had to pay a high price, since it will have to transfer part of its business.
Bayer announced in mid-September 2016 the acquisition of the biotechnology company Monsanto for some 66,000 million dollars (62,600 million euros) after agreeing to pay 128 dollars per share.
The US authorities had reservations to authorize the transaction and considered it illegal because of the market power of the world’s largest integrated seed and pesticide company.
To finally obtain approval, Bayer had to make the largest commitment agreement that has been reached in the United States for an acquisition, according to the Department of Justice.
A “historical arrangement”, but controversial
Bayer will have to sell off parts of its business for almost 9,000 million dollars, including its own seed business, so that the merger with Monsanto does not imply a loss to competitors and users. A spokesman for the Department considered that it was a “historic arrangement”.
The European Union had authorized the purchase at the end of March, but under a series of strict conditions such as the elimination of the overlap with Monsanto in the seeds and pesticides markets, and disinvest in global research and the development of seeds and new characteristics.
The so-called “mega-fusion” was not welcomed by environmentalists and other aid organizations, due to the criticism generated by Monsanto for its genetically modified products and the use of the controversial glyphosate herbicide.