WASHINGTON (AP) - Agricultural business giant Monsanto is abandoning its takeover bid for competitor Syngenta AG after the Swiss chemical producer rejected its latest offer of nearly $47 billion.
WASHINGTON (AP) — Agricultural business giant Monsanto is abandoning its takeover bid for competitor Syngenta AG after the Swiss chemical producer rejected its latest offer of nearly $47 billion.
A combination with Basel-based Syngenta would have made Monsanto the world's largest producer of farming chemicals, on top of its market-leading seed business. But the Swiss company rejected a series of unsolicited offers from the American company.
Monsanto confirmed Wednesday that it had raised its offer last week to 470 francs per share, or nearly $47 billion, from a previous offer of about $45 billion. Additionally, the company confirmed it had raised its proposed breakup fee to $3 billion from $2 billion. That's the amount Monsanto would have paid Syngenta if it had been unable to get regulatory approval to complete the deal.
But Monsanto says the enhanced offer "did not meet Syngenta's financial expectations." The St. Louis-based company said in a statement it would "continue to focus on its growth opportunities built on its existing core business."
In June, Syngenta's chairman Michel Demaré said Monsanto's offer undervalued the pesticide maker's business, which "they are trying to buy on the cheap." He also said that Monsanto was underestimating the antitrust challenges of combining the two companies.
Merging with Syngenta would have helped Monsanto diversify its chemical offerings beyond Roundup, the ubiquitous weed killer that long served as the cornerstone of Monsanto's business. Sales of that chemical have been hurt in recent months by concerns about its safety when used in large-scale industrial farming.
In March the International Agency for Research on Cancer labeled the Roundup's key ingredient, glyphosate, a "probable carcinogen." The company has demanded a retraction from the group, a French research arm of the World Health Organization.
Monsanto Co. shares rose $7.05, or 7.9 percent, to $96.44 in midday trading Wednesday. Shares of Syngenta AG fell more than 16 percent.