Shareholders of American seeds and agrochemicals company Monsanto Co green lit the company’s $66 billion acquisition by Bayer AG on Tuesday, a deal that has yet to be approved by federal agencies before it can close as expected in late 2017.
Future boosted development and research spending by the merged companies and plans to erect a global seeds and biotechnology headquarters in St. Louis were announced in a bid to persuade regulators not to block the deal, which was first announced in September, Monsanto CEO Hugh Grant said.
“I think those augur well for the deal,” he said.
The merger of the two companies will mean more than a quarter of the combined world market for pesticides and seeds will be controlled by the future entity in the fast-consolidating farm supplies industry.
It is yet unclear whether President-elect Donald Trump, after taking office in January, is opposed to the consolidation of large mergers. Trump vowed during his campaign to block AT&T Inc’s purchase of Time Warner Inc and stated he would help break up the Comcast Corp deal to acquire NBC Universal, out of concern of there being too much concentration of power.
The White House does not directly decide if a merger should be blocked under antitrust law. That is done by the U.S. Justice Department or Federal Trade Commission, which together assess all big company mergers. If one of the agencies opts to halt a deal, it must persuade a judge to rule against the merger.
Grant said he has not talked with Trump or any of his transition team and did not state what the company was doing to make sure the deal will happen.
The acquisition is the latest in a string of large mergers to affect the agribusiness sector since last year or so. These include ChemChina’s acquisition of Swiss chemicals company Syngenta AG and the merger of Dow Chemical and DuPont.