Bayer has raised its all-cash offer to Monsanto shareholders to US$125 per share from US$122.
Bayer said in a news release it has been in private talks with Monsanto and had received additional information that warranted a higher bid.
The company said it had “comprehensively addressed Monsanto’s questions concerning financing and regulatory matters and is prepared to make certain commitments to regulators, if required, to complete the proposed acquisition of Monsanto.”
Monsanto has not responded to the increased offer. Reuters reports that the company might respond as early as next week.
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Bayer says it has lenders lined up for the entire transaction financing and the offer is not subject to a financing condition.
In addition to certain commitments to regulators, should they be required, Bayer has offered a $1.5 billion reverse antitrust break fee, reaffirming its confidence in a successful closing.
“We are convinced that this transaction is the best opportunity available to provide Monsanto shareholders with highly attractive, immediate and certain value. Bayer is fully committed to pursuing this transaction,” said Werner Baumann, chief executive of Bayer AG, in the news release
The revised offer represents a premium of 40 percent over Monsanto’s closing share price on May 9.
On Wednesday Bloomberg reported, quoting unnamed sources, that Monsanto had revived talks with BASF about combining their ag chemical businesses.
The Bloomberg sources said Monsanto offered to buy BASF’s farm chemical division using as payment newly issued shares in Monsanto.
Earlier this year, Monsanto held talks with both BASF and Bayer about possible deals after losing the battle for Syngenta to ChemChina, Bloomberg said.
Monsanto posted lower than expected third quarter profit and sales and said its full year earnings would be at the low end of its previous forecast of $4.40 to $5,50 a share.
In the third quarter report issued in late June, the company said it had net income of $717 million, down from $1.14 million in the same quarter last year.
The company is struggling as it faces lower farmer spending amid weak crop prices.
