German chemical giant Bayer’s $66bn (£50bn) deal to buy controversial US agrochemical giant Monsanto and create the world’s largest seeds and pesticides company is “a threat to all Americans” and should be blocked, Bernie Sanders said on Wednesday.
Speaking shortly after the deal was announced, the Vermont senator, who ran against Hillary Clinton for the Democratic presidential nomination, said: “The attempted takeover of Monsanto by Bayer is a threat to all Americans.”
“These mergers boost the profits of huge corporations and leave Americans paying even higher prices. Not only should this merger be blocked, but the Department of Justice should reopen its investigation of Monsanto’s monopoly over the seed and chemical market.”
He called for the proposed takeover to be blocked and for a fresh investigation into Monsanto’s current control of the seed market.
The proposed deal, the biggest corporate takeover deal so far this year, follows a wave of consolidation in the seeds and agriculture industry and has raised concerns among politicians, scientists, regulators, farmers and activists who called the deal a “marriage made in hell”.
Werner Baumann, chief executive of Bayer, which is most famous for developing aspirin, said “the combination of our two great organizations [will] deliver substantial value to shareholders, our customers, employees and society at large”.
But farmers and environmentalists warned the deal could lead to a reduction in seed variety, an increase in genetically modified crops and higher seed costs and therefore crop and food prices.
The proposed takeover is likely to face intense regulatory scrutiny in the US and Europe, particularly as it quickly follows two other mega-deals in the agriculture industry and would leave control of almost two-thirds of the world’s seeds and pesticides in the hands of three firms.
Analysts at Bernstein Research said they thought there was only a 50:50 chance of the deal winning regulatory clearance. “We believe political pushback to this deal, ranging from farmer dissatisfaction with all their suppliers consolidating in the face of low farm net incomes to dissatisfaction with Monsanto leaving the United States, could provide significant delays and complications,” they said in a research note. Because of the difficulties expected in getting the deal through, Bayer has agreed to pay Monsanto $2bn if the tie-up falls apart because of competition concerns.
Friends of the Earth described the takeover, which will see Bayer pay $128 per share – a 44% premium on Monsanto’s share price before the proposed deal was first revealed in May, as a “marriage made in hell”.
By Adrian Bebb
Source: The Guardian
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