Monsanto has upped the stakes in its bid to acquire Swiss-based seed and agro-chemical company Syngenta, increasing its offer from €415 per share to €435 per share.
The improved offer from Monsanto values the Syngenta business at more than €40bn.
Syngenta rejected two separate takeover offers from Monsanto earlier this year. The first offer, €415 per share or €38.6bn, was rejected back in May, with the board of Syngenta saying it “fundamentally undervalued” the business.
Syngenta argued that the group’s valuation at the time was under pressure due to weak crop prices and currency headwinds and that Monsanto was seeking to take advantage of that with its “inadequate” takeover bid.
Syngenta then rejected a second bid from its US rival a month later in June. The second bid was effectively the same as the first but offered an added €1.7bn break-up fee should the proposed merger fall through due to any regulatory issues.
The latest offer from Monsanto includes an increase in the break-up fee from €1.7bn to €2.6bn should the proposed deal be blocked by regulators.
So far there has been no reaction from Syngenta to this latest offer. Shares in Syngenta increased by more than 8% during trading on Tuesday to over €358 on the back of the news.
Any merger of Monsanto and Syngenta would create by far the largest seed and chemical company in the world, with a turnover close to €30bn. Combined they would control about 40% of both the seed and chemical markets.
The seed and chemical markets are already highly concentrated, with the “big six” companies (Monsanto, Syngenta, Bayer, DuPont, BASF and Dow) controlling 70% of the global seed market and 90% of the agro-chemical market.
Monsanto currently controls some 30% of the global seed market and 10% of the global agro-chemical market while Syngenta holds about 9% of the seed market and 24% of the chemical market.
Monsanto alone has a current seed and trait footprint that touches corn, soyabeans and cotton on around 400 million acres globally.