Germany-based Bayer Group Company has completed the acquisition of Monsanto in a move that will affect shareholding of the local firm where Kenya’s businessman Chris Kirubi is a significant shareholder.
However, the two companies will have to operate independently for a period of about two months as a condition by the US Department of Justice for approval of the transaction.
The department requires Bayer to complete the sale of some of its businesses to BASF.
Bayer is required to sell agricultural businesses and assets worth about $9 billion to chemical giant BASF as a precondition for approval of its $66 billion acquisition of Monsanto.
Bayer and St Louis-based Monsanto are two of the world’s biggest agricultural companies and currently compete to sell farmers seed and crop protection products.
Mr Kirubi owns a 45 per cent stake in Bayer East Africa, which is a subsidiary of the Bayer Group.
“The deal closing represents an important milestone toward our vision of creating a leading agricultural company to support growers in their efforts to be more productive, more profitable and more sustainable for the benefit of our planet and consumers,” says Monsanto head of corporate Jimmy Kiberu.
Mr Kiberu said once the deal with BASF is complete, the two firms would be collapsed into one under Bayer. “Once Bayer’s deal with BASF is complete, we will proceed with integrating Monsanto into Bayer. Bayer expects this to be in approximately two months,” he said.
Comesa Competition Commission cleared the acquisition of Monsanto Company by Bayer last year, paving the way for acquisition.
Monsanto Kenya is a leading supplier of hybrid seed brands in large-acre crops such as maize, cotton, and oilseed (soybeans and canola), as well as small-acre crops such as vegetables.
Monsanto has been pushing for the introduction of biotech cotton in Kenya and has this year received an approval from National Biosafety Authority to conduct the field trials of the crop.
Monsanto is a company incorporated under the laws of the State of Delaware in the US and is listed on the New York Stock Exchange. It has operations in Europe, North America, Asia, Africa, Latin America, the Middle East and Australia. Bayer, which has three lines of business in three divisions — pharmaceuticals, consumer health and crop science — has operations in Europe, North America, Asia, Africa, Latin America and Australia.