Monsanto reported giving Bayer limited access to its books

Frankfurt | Reuters — U.S. seed company Monsanto has given German suitor Bayer limited access to its books after turning down a sweetened US$64 billion takeover offer last month, two sources familiar with the situation told Reuters.

The parties have not yet signed a non-disclosure agreement, which would allow Bayer to conduct due diligence, but Monsanto is giving the company a limited drip of information, the sources said.

They said Bayer had no appetite to put a deal at risk by going hostile, although talks were “difficult.” The sources requested anonymity because they were not authorized to talk about the matter.

Bayer declined to comment about the development.

Monsanto remains in talks with Bayer and other parties about potential strategic transactions, CEO Hugh Grant told investors gathered at a two-day event in St. Louis on Wednesday. He said the company would not comment further on M+A action and the discussions with Bayer during the event.

The seed and agrochemical industry, long dominated by a handful of big companies, has been jolted by several large deals in the past year as low crop prices and belt-tightening by farmers pressured earnings.

Monsanto’s rejection last month of Bayer’s latest offer put pressure on the German healthcare and chemical group to increase it to at least get access to the company’s books.

Monsanto stock was down 1.2 per cent at US$104.30, well below Bayer’s $125-per-share offer, in afternoon New York Stock Exchange trading. Bayer closed down 2.3 per cent at 95.65 euros (C$138.79) in Frankfurt.

— Writing for Reuters by Georgina Prodhan; additional reporting for Reuters by Karl Plume in Chicago.