Canada’s competition regulator says it has reached an agreement with Bayer that lays out the conditions for its proposed acquisition of Monsanto.
The announcement comes a day after the U.S. Department of Justice gave its conditional approval to the US$66 billion deal.
The Competition Bureau concluded that the deal “would likely substantially lessen and prevent competition in Canada with respect to the supply of canola seeds and traits, soybean seeds and traits, seed treatments that protect crops against nematodes, and carrot seeds.”
In canola seed, for example, the Bureau says Bayer’s LibertyLink herbicide tolerance trait holds approximately 55 percent Canadian market share, while Monsanto’s Roundup Ready trait can be found in 40 percent of canola seed.
In line with the requirements from anti-trust regulators in the EU and the U.S., the agreement with the Competition Bureau requires Bayer sell the following Bayer assets:
- canola seed and canola traits business;
- soybean seed and soybean traits business;
- carrot seed business;
- nematode seed treatment business;
- glufosinate-ammonium herbicide (Liberty) business;
- LibertyLink herbicide tolerance technology;
- assets related to the Centurion herbicide;
- and its digital farming business in Canada.
“Agriculture has always been a critical part of the Canadian economy, and innovation remains as important in this industry as in emerging sectors. This agreement with Bayer will protect competition and innovation in Canada’s agricultural sector, and is the result of a collaborative approach with the parties and our international counterparts,” says John Pecman, the Bureau’s Commissioner of Competition.
BASF has signed a deal to buy the assets listed in the agreement from Bayer. The Bureau says it is still reviewing the suitability of BASF as the buyer.
Given the multinational nature of both businesses, the Bureau notes it coordinated its review with other jurisdictions, including the European Commission and the U.S. Department of Justice.
The U.S. anti-trust authority said integration of Monsanto into Bayer can take place as soon as the divestments to BASF have been completed. On Tuesday, Bayer said they expect this will take place in approximately two months.
Bayer also said it expected to receive final outstanding approvals “very shortly.”