The agrochemical industry is set for another major adjustment as the European Commission gave the greenlight to Bayer for a proposed takeover of Monsanto.
A petition with more than a million signatures was not enough to prevent the European Commission from giving their consent to the deal, with Competition Commissioner Margrethe Vestager handing down the verdict of the antitrust enquiry. The approval, dubbed “a major success and a significant milestone” by Bayer CEO Werner Baumann, comes as something of a surprise given the huge opposition.
The asterisk to the Commission’s approval is the assurance that Bayer will sell a variety of assets to rivals BASF SE, including seeds and pesticides, and a license to its digital farming data. This concession from Bayer was what finally won over the Commission, Vestager claiming that it would ensure “effective competition and innovation in seeds, pesticides and digital agriculture markets”
Nevertheless, the $66 billion takeover, would be the most recent in a series of changes in the agrochemical industry, featuring among others a merger between US multinationals Dow and Dupont. The result of the acquisition of Monsanto would mean that more than a quarter of the world’s seed and pesticides market will be in the hands of the one Bayer-Monsanto company.
This may not worry the European Commissioners enough, but there are plenty who see this as cause for major concern. The Greens spokesman in the European Parliament, Bart Staes, voiced concern about the effect that the merger would have on the agriculture industry’s smaller players, adding “The agriculture industry is already far too concentrated, giving a handful of massive firms a stranglehold on food production. Merging two of the biggest players only makes a bad situation worse.”
Slow Food president Carlo Petrini condemned the merger and the European Commission’s decision “This concept isn’t new, but the magnitude is. If, from now on, even the institutions whose role it is to protect and represent the interests of citizens, resources and ecosystems, approve mergers of the sort, we cannot doubt that we are facing the clearest and largest ever expression of globalization”.
Despite the outcry, it seems that Bayer have definitively entered the home stretch, with US regulators from the Department of Justice appearing as the last significant obstacle remaining. The German giants are aiming to wrap everything up by the end of June.