The German chemicals multinational Bayer said on Wednesday it had signed a US$66 billion takeover deal with the US seeds and pesticides firm Monsanto.
“Bayer and Monsanto today announced that they signed a definitive merger agreement under which Bayer will acquire Monsanto for $128 per share in an all-cash transaction,” the firms said.
Bayer repeatedly increased its offer to Monsanto since its first $122-per-share bid, but the US firm had until now held out for more cash.
“This represents a major step forward for our crop science business,” said the Bayer chief executive Werner Baumann.
The two firms said the deal “brings together two different, but highly complementary” businesses.
Monsanto shareholders still have to approve the deal, as do regulators – with Bayer staking a $2bn reverse anti-trust break fee in case the merger is rejected by US or European authorities.
The deal is expected to be completed by the end of 2017.
Bayer has been pursuing Monsanto since late May, when it made an initial bid of $122 per share, valuing the US genetically modified (GM) crop giant at $62bn.
Monsanto rejected that bid, but said it was “open” to further talks.
Since then the German chemicals behemoth has raised its offer twice, first to $125 per share in July and then to $127.50 last week, but was rebuffed each time.
Monsanto held out for more money, calling the July bid “insufficient”.
The long-mooted tie-up has rung alarms bells for some farmers who fear the power of the combined company in the market for seeds and pesticides, while opponents of genetically-modified food in Europe worry about Monsanto’s influence on the continent.
“We do not like this transaction, because we think that Bayer is overpaying significantly,” wrote the analyst Peter Spengler of DZ bank on Wednesday.
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