German chemicals giant Bayer AG and US seeds company Monsanto are reportedly selling assets worth some US$2.5bn as they seek regulatory clearance for their US$66bn merger.
A 9 March Reuters report quoted people close to the matter as saying that Bayer's advisors would be sending out information packages to potential bidders for businesses divided into three bundles of assets.
These businesses potentially included soyabean, cotton and canola seed assets as well as LibertyLink-branded crops resistant to Bayer’s glufosinate herbicide, an important alternative to Monsanto's Roundup Ready seeds, Reuters said. They comprised sets of different active ingredients in severa global regions.
“Bayer and Monsanto have said in the past that they expect to divest activities with combined sales of up to US$1.6bn,” the report said.
Bayer indicated earlier in February that it expected to complete its takeover by the end of the year.
CEO Werner Baumann told journalists at a meeting in Leverkusen, Germany that it would only seek EU approval next quarter after regulators asked for more information, Bloomberg reported. Bayer was also responding to a second request from the US Department of Justice.
Reuters said the regulatory hurdles were believed to be manageable because Bayer's main business in agriculture was pesticides while Monsanto's focus was on genetically modified seeds.
Bayer first announced its purchase of Monsanto on 14 September 2016. The merger is one of three in the agriculture seed and crop protection markets currently under anti-trust review. China National Chemical Corp announced a US$43bn takeover of Swiss seed and pesticide giant Syngenta AG on 3 February 2016. And US chemical leaders Dow Chemical Co and DuPont Co announced a US$130bn merger to create DowDuPont Inc on 11 December 2015.