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China’s anti-trust watchdog on Tuesday approved Bayer’s planned acquisition of the world’s largest seed company Monsanto on the condition that the company will spin off some businesses globally, a step forward in the deal’s onerous struggle.
The Ministry of Commerce (MOFCOM) started the antitrust review early last year and concluded that the German drug and crop chemical maker must dispose of its vegetable seeds business, as well as assets of herbicide, corn, soybean, cotton and rapeseed, including related intellectual property rights, workforce, production facilities and other tangible/intangible assets, according to a statement on the regulator’s website.
Bayer will also be required to allow all Chinese agricultural software developers to access the merged entity’s digital agricultural platforms in China on fair, reasonable and non-discriminatory terms, five years after the entity enters China’s digital agriculture market.
Bayer’s 62.5-billion-dollar takeover of Monsanto, announced in 2016, is set to create the world’s largest seeds and pesticides company.
The planned merge will need the approval of regulators from around 30 countries in which it would operate in. The merge was approved by the Brazilian antitrust regulator in February without requiring further asset sales beyond a global proposal announced last October.
Bayer clinched a deal in October to sell its seed and herbicide businesses to BASF for 5.9 billion euros (7.2 billion US dollars), a proposed solution to allay antitrust concerns.
The companies are still waiting for the deal to be approved in jurisdictions including the EU, the US and India, where the final rulings are currently pending.
The EU competition authority is scheduled to decide by April 5, while analysts said Bayer is set to win EU approval.
The US review is not as far advanced as EU’s, Bayer said.
In India, Bayer’s goal is to obtain approval by May, said Richard van der Merwe, CEO of Bayer CropScience Ltd in India. But the merge is expected to face stiff opposition there, especially due to the negative impacts of GMO crops on the environment and the economy.
In addition, Bayer has taken Russia’s antitrust regulator to court over the regulator’s investigation into the deal, and a Bayer spokesperson said the company was petitioning the court in Russia to be given more time to discuss demands made by the regulator about the deal.
(CGTN)
