Monsanto spurns Bayer's acquisition offer

U.S. global seed and pesticide maker Monsanto rejected the latest acquisition offer from German health and agricultural giant Bayer, which had sweetened its bid earlier this month.

Monsanto signaled that it is keeping its options open, having already said it is weighing alternatives to Bayer's $65 billion offer.

The Monsanto board said in a statement that it had deemed Bayer's offer "financially inadequate and insufficient to ensure deal certainty."

But it added: "Monsanto remains open to continued and constructive conversations with Bayer and other parties to assess whether a transaction that the Board believes is in the best interest of Monsanto shareowners can be realized."

Bayer's latest offer was $125 per share, up from a previous offer of $122, or $62 billion. A combination of Bayer and St. Louis-based Bayer would create the world's largest agricultural supplier.

Monsanto shares (MON) fell 1.4% in pre-market trading Tuesday to $105, as the market appears to remain skeptical that a deal will get done, as demonstrated by the fact that shares remain well below the offer price.

Monsanto CEO Hugh Grant has said openly that the company is reviewing alternative options, which Bloomberg recently reported could include a deal with BASF's agricultural division.

To assuage concerns over potential regulatory obstacles, Bayer said Thursday that it is now also offering a breakup fee of $1.5 billion if government officials block the acquisition. Bayer said it delivered the new offer verbally July 1 and officially July 9.

Follow Paste BN reporter Nathan Bomey on Twitter @NathanBomey.