German pharma and chemical major Bayer group today announced mandatory open offer to buy up to 26 per cent additinal stake in the Monsanto India Ltd for over Rs 1,100 crore following its global deal to acquire US-based biotech major.
In the open offer, Bayer will acquire up to 44,88,315 shares of Monsanto India Ltd from public shareholders at a price of Rs 2,481.60 apiece.
The offer price is 4 per cent higher than the Monsanto India’s closing rate of Rs 2,390 per share today on the BSE.
On September 14, Bayer AG announced acquisition of Monsanto for USD 66 billion to create the world’s biggest seed and pesticide firm.
After completion of the proposed deal, Bayer group will be indirectly acquiring the 72.14 per cent voting share capital of the Monsanto India, triggering into launch of an open offer for the shareholders of the Monsanto India Ltd.
Monsanto group holds 72.14 per cent stake in the Monsanto India Ltd as on June 30, 2016, according to regulatory filing.
Monsanto India Ltd informed that DSP Merrill Lynch Ltd and Credit Suisse Securities (India) Pvt Ltd have issued public announcement for the open offer on behalf of Bayer group.
The size of the open offer is for the “acquisition of up to 4,488,315 fully paid-up equity shares of face value of Rs 10 each, representing 26 per cent of the fully diluted voting equity share capital of Monsanto India by Bayer Aktiengesellschaft”.
Both Bayer and Monsanto have presence in India with the US firm selling genetically modified (GM) cotton seeds in the country for more than a decade.
The deal, expected to close by the end of 2017, marked a major consolidation in global seed business. Recently, Monsanto’s rival Syngenta was acquired by China’s state-owned firm ChemChina.
Bayer had revised its offer multiple times before it finally clinched the deal. It first offered USD 122 per share, which was subsequently raised to USD 125 per share and USD 127.50. Finally, the deal was signed at USD 128 a share.
Monsanto, which played a key role in increasing cotton output through genetically modified technologies, has three entities in India — Monsanto India Ltd, Monsanto Holdings Pvt Ltd and JV firm Mahyco Monsanto Biotech India Ltd with a staff strength of more than 1,000.
Bayer CropScience, a listed Indian entity, posted a turnover of Rs 3,818.60 crore last fiscal. Besides crop science, Bayer also has interest in pharmaceuticals, animal health and consumer health in the country.