Renowned Germany based Bayer AG, a key player across the life sciences industry, has plans to collaborate with Monsanto, in a bid to resolve the obstacles related to crop technology of the food products dished out by the latter. The merger is expected to help both the firms accrue an annual revenue of over USD 67 billion, that would perhaps pave the way for the joint venture to acquire the leading position across the global seed & crop chemical sector. The European Commission has been analyzing this potential multi-billion-dollar deal between Monsanto and Bayer AG, which is yet to gain closure. The latter is set to acquire the former by the end of 2017 after receiving the approval from the European Commission. Bayer’s expectation from this deal borders on the promotion of its own herbicides and products such as Poncho & Liberty, in tandem with Monsanto’s products. The deal will also support the growth of the genetically modified crop sector over the coming years.
Experts state that the primary aim behind this strategic merger is to address the concerns pertaining to pollinator decline and the requirement of herbicides to prevent the growth of weeds. This deal will promote advanced biotechnologies such as gene editing technologies and alike, for which the agrochemicals market giant had received the licensing rights in 2016. With the help of these newly developed crop technologies, Bayer will try to produce new crops and plants with disease curing abilities.
Post the expected closure of this acquisition, the key business participants would be merged into a single unit that would combinedly address the crop damage issues related to Monsanto’s Xtendimax, a dicamba pesticide. For the record, in 2017, nearly 3,20,000 acres of soybeans were damaged due to dicamba across Missouri. The Bayer-Monsanto deal will thus, aim to provide an impetus to research activities for obtaining high quality as well as greater yield of crops across the farming sector.
Over the past few years, the agrochemicals sector has witnessed a steep decline in the commodity costs, which has prompted the adoption of strategic tactics such as M&As among the business players. These initiatives have, to quite an extent, consolidated the competitive landscape of the agrochemicals industry.
Dhananjay develops content for Market Size Forecasters. A post graduate in mathematics as well as business administration, he worked as a process executive in Infosys BPO Limited before switching his professional genre. Following his childhood passion, he opted for a career in writing and now pens d...