Bayer Monsanto $62 Billion Bid Led by Allen & Overy and Sullivan

24 May, 2016

In response to further market speculation and stakeholder inquiries, Bayer is publicly disclosing the contents of its private proposal to acquire Monsanto. Bayer has made an all-cash offer to acquire all of the issued and outstanding shares of common stock of Monsanto Company for $122 per share or an aggregate value of $62 billion.

This offer, based on Bayer’s written proposal to Monsanto dated May 10, 2016, represents a substantial premium of:

–          37% over Monsanto’s closing share price of $89.03 on May 9, 2016
–          36% over the three-month volume weighted average share price
–          33% over the six-month volume weighted average share price
–          Last twelve months EBITDA multiple of 15.8x as of February 29, 2016

The acquisition of Monsanto would be a compelling opportunity to create a global agriculture leader, while reinforcing Bayer as a Life Science company with a deepened position in a long-term growth industry. The combination is expected to provide Bayer’s shareholders with accretion to core EPS by a mid-single-digit percentage in the first full year after closing and a double-digit percentage thereafter. Initially, Bayer expects annual earnings contributions from total synergies of approximately $1.5 billion after year three, plus additional integrated offer benefits in future years.

The transaction will be subject to customary closing conditions.

Bayer’s legal advisors are Sullivan & Cromwell LLP (M&A) and Allen & Overy LLP (Financing).

BofA Merrill Lynch and Credit Suisse are acting as lead financial advisors to Bayer and support the financing of the transaction; Rothschild has been retained as an additional financial advisor to Bayer.

(Source: Bayer Corporation)

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