The seed shift has started

It has been 100 weeks since September 14, 2016, when Bayer signed an agreement with Monsanto to acquire the company for $66 billion, or $128 per share. Yesterday, BASF closed the acquisition of Bayer’s global vegetable seeds business Nunhems, opening the door for the integration of Monsanto into the Bayer group. An expensive one: following the recent Monsanto Roundup trial, the company's stock slid away, devaluating the company's stock with 18.6 per cent so far.

While videos on the social media of BASF and Nunhems employees show a welcome ritual, the company also shared some details on the acquisition. "The acquired vegetable seeds business comprises 24 crops and about 2,600 varieties. It also includes R&D and breeding systems with over 100 unique breeding programs in more than 15 crops", they say. "This closing completes BASF’s acquisition of a significant range of businesses and assets with combined 2017 sales of €2.2 billion, which Bayer offered to divest in the context of its takeover of Monsanto. The all-cash purchase price amounts to a total of €7.6 billion, subject to certain adjustments at closing."

It seems both greenhouse vegetable brands are likely to continue their business relatively undisturbed. BASF is currently not a player in the greenhouse vegetable business, but with the acquisition of the complete business unit, they're buying a running factory. The Vegetable Seeds business has always been operating relatively independently, and the acquisition includes ongoing activities like the currently expanding GreenEx project. So far the only visible difference is the Nunhems website, currently showing a BASF brand.

The integration of Monsanto into the Bayer Group can also begin. Bayer already became the sole owner of Monsanto Company on June 7, 2018. One of the requirements of the U.S. Department of Justice was that Bayer and Monsanto remain separate companies and continue to operate separately until completion of these divestments to BASF, and that has now taken place.

Glyphosate verdict
Bayer responds in a press release to the glyphosate verdict as well, following the gigantic value decrease in their stocks.

As regards the glyphosate verdict in California on August 10, 2018, Bayer believes that the jury’s decision is at odds with the weight of scientific evidence, decades of real world experience and the conclusions of regulators around the world that all confirm glyphosate is safe and does not cause non-Hodgkin’s lymphoma. The National Institutes of Health (NIH) recently reaffirmed glyphosate does not cause cancer. The U.S. Environmental Protection Agency (EPA), the European Food Safety Authority (EFSA), the European Chemicals Agency (ECHA) and other regulators around the world have also concluded that glyphosate can be used safely, Bayer reports.

The jury’s verdict is just the first step in this case, and it remains subject to post-trial motions in the trial court and to an appeal, as announced by Monsanto. As this case proceeds, Bayer believes courts ultimately will find that Monsanto and glyphosate were not responsible for Mr. Johnson’s illness.

Due to the aforementioned requirements imposed by the U.S. Department of Justice, Bayer did not have access to detailed internal information at Monsanto. Under these conditions, Bayer was not permitted to influence matters relating to Monsanto’s business, and its ability to actively comment on them in detail was extremely limited. Now, however, Bayer also gains the ability to become actively involved in defense efforts in the glyphosate trials and any other legal disputes, such as potential claims for damages in connection with the product Dicamba.