Midwestern Financial Group I Fiduciary Advisors I Wealth Management


Monsanto Really, Really, Really Wants Syngenta

Monsanto, the world's #1 seed company, is actively pursing Syngenta, a Switzerland-based seed company ranked #3 in the world. 

At the moment, Syngenta has hesitations about the deal. In early May, Syngenta reportedly rejected a $45 billion bid from Monsanto, saying the amount undervalues the Swiss company. The valuation is notable, but government anti-trust concerns are the bigger issue. 

According to research done by Wells Fargo, a combined Monsanto and Syngenta would dominate over 40 percent of U.S. corn seeds market. In addition, tax inversions have raised scrutiny from the Feds. If Monsanto buys Syngenta and moves its allegiance to Switzerland, which lowers it's tax rate, the U.S. government will be even more cautious with approval of such deal. 

As a result, Monsanto is pulling out all stops. According to a report by the Wall Street Journal, Monsanto will sell Syngenta's seed business in order to make the deal happen. Which leads to this question: why does Monsanto want to buy Syngenta? The answer: their chemicals business. Syngenta is the world's largest pesticide seller. 

Midwestern Financial