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

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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