Brussels — Bayer has cleared one big hurdle for its $66bn takeover of Monsanto by winning EU approval after agreeing to bolster BASF by selling it seeds, pesticides and digital agriculture technology.
BASF is lined up to buy Bayer’s global broadacre seeds, glufosinate assets and three research lines for herbicides.
Bayer and BASF "need to provide further evidence" of BASF’s ability and incentives to build the business into an important competitor in order for BASF to get approval to buy the more than €6bn package, the EU said.
The EU did not specify a buyer for Bayer’s vegetable seeds unit. Bayer has suggested BASF should take it over.
The companies’ concessions allayed the EU’s antitrust "concerns in full", said EU Competition Commissioner Margrethe Vestager. "We have made sure that the number of global players actively competing in these markets stays the same. That is important because we need competition to ensure farmers have a choice of different seed varieties and pesticides at affordable prices."
Bayer and Monsanto must still convince US regulators, who are pushing for the companies to divest more assets to resolve antitrust concerns.
Bayer is suing the Russian antitrust watchdog over an order for it to share technology with Russian companies.
Bayer said it was aiming to complete the deal by the end of the second quarter. It was working closely with the US department of justice, it said.
Wednesday’s merger decision is arguably Vestager’s most controversial one yet.
Environmentalists including actor Mark Ruffalo have bombarded her with tweets, e-mails, letters and postcards begging her to block a "merger from hell" that might harm human health, farming and the environment.