New Delhi: Bayer AG is confident it would get approval from the Competition Commission of India (CCI) for its proposed buyout of Monsanto, without which the global deal could get stalled, the German drugs and crop chemicals company’s South Asia representative Richard van der Merwe said on Tuesday.
“We are confident of getting CCI’s approval by May without which we cannot sign the global deal,” van der Merwe said, adding that 14 of the 30 countries where a regulatory approval was required had approved the deal. Among countries that have cleared the deal are South Africa, Russia and Ukraine. The US and European Union are yet to give their approvals.
The firms announced in September 2016 that Bayer would acquire Monsanto for $66 billion. Bayer’s business interests are in pharmaceuticals and crop sciences, while Monsanto is a global giant in seeds, biotechnology and herbicides.
On 5 January, CCI invited comments from the public on the proposed acquisition. “The Commission is of the prima facie opinion that the proposed combination is likely to have an appreciable adverse effect on competition,” CCI said in an official statement.
To allay fears that the merger will impede competition in India, van der Merwe, who is also managing director of Bayer CropScience Ltd in India, said “the current businesses of Bayer and Monsanto worldwide are complementary in nature and we believe that by combining the two companies we will be more successful in innovation and research”.
“If you look at the two portfolios, there is no significant overlap or dominance,” he added.
According to the rules of merger laid down by CCI, if a global deal is done without its approval, it can impose a penalty of up to 1% of the turnover or assets of the merged entity, whichever is higher.
The EU last August initiated a probe into the Bayer-Monsanto deal, saying it would create the world’s largest pesticides and seeds firm and limit the number of competitors in Europe. Global businesses with significant interests in agriculture have seen a spate of mergers recently which include Chinese state-owned chemical firm ChemChina’s takeover of Swiss agribusiness firm Syngenta AG and the merger of American chemicals giant Dow Chemicals with DuPont last year.livemint