BASF SE (BAS.XE) said on Friday that it has signed an agreement to buy significant parts of Bayer AG's (BAYN.XE) seed and non-selective herbicide businesses for 5.9 billion euros ($6.99 billion), subject to certain adjustments at closing.
German pharmaceutical company Bayer said that the assets to be sold include its global glufosinate-ammonium business and related LibertyLink technology for herbicide tolerance, almost all its field-crop seeds businesses, as well as respective research-and-development capabilities.
The businesses included in the agreement generated around EUR1.3 billion in net sales for 2016 and the deal is expected to close in the first quarter of 2018. Bayer said that it agreed to the deal in light of its planned acquisition of Monsanto Co. (MON), adding that it will use the net proceeds from the BASF transaction to partially refinance the purchase of the U.S. agricultural company.
"We are taking an active approach to address potential regulatory concerns, with the goal of facilitating a successful close of the Monsanto transaction," said Werner Baumann, Bayer's chief executive and chairman of the board of management.
Bayer said that BASF has committed to maintaining all permanent positions for at least three years after the transaction is completed. More than 1,800 Bayer personnel will transfer to BASF.
Under the deal, BASF will acquire Bayer's manufacturing sites for glufosinate-ammonium production and formulation in Germany, the U.S. and Canada, its seed-breeding facilities in the Americas and Europe and its trait-research facilities in the Americas and Europe.
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(END) Dow Jones Newswires
October 13, 2017 02:27 ET (06:27 GMT)