Analysts Question Bayer-Monsanto Merger

Dan General, Industry News Release

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A Bloomberg report says anti-trust officials have their hands full as they review several pending mergers and acquisitions in agribusiness, with the newest being Bayer’s acquisition of Monsanto. The $66 billion deal consolidates the biggest seed and chemical producers in the industry. Elai Katz is an antitrust attorney at a major New York City law firm, and he said antitrust reviewers around the world have to look at how all the deals would impact the world instead of considering them on a case-by-case basis. “It’s always about the future,” Katz said. “You have to imagine what the world will look like after these mergers, and that complicates things.” According to Jonas Oxgaard, a Sanford Berstein analyst, seed and crop chemicals are major expenses for producers and this combination of Bayer and Monsanto could have some political backlash. “There’s a political angle that will make this deal hard to get past regulators,” said Oxgaard. With four other major consolidation deals in the works, economists are questioning whether there’s too much consolidation in agriculture. “Have there been too many mergers, are companies getting too big, is there not enough competition,” asked Keith Fugle, a U.S. Department of Agriculture economist. “Experts have been asking questions like this in other sectors of the economy and now this trend is happening in agriculture.”

From the National Association of Farm Broadcasting news service.

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