In a now-dead deal reported post-mortem by Bloomberg Tuesday, Monsanto is said to have considered a deal with Syngenta to take over the Swiss-owned company and thus move its tax location to Switzerland.
According to the report, Monsanto and Syngenta over the past few months have held preliminary talks with advisers about a potential merger, though Syngenta ultimately ended discussions in late May.
Monsanto is worth about $64 billion, while Syngenta is worth $34 billion. A deal would have allowed Monsanto to avoid corporate taxes in the U.S., the article said.
Sources identified in the report said the tax benefits created a concern during the talks, as did antitrust issues. Sanford C. Bernstein analysts led by Jeremy Redenius said in a note to investors that public opinion could be a factor as well.
Syngenta shares jumped on the news Tuesday, Bloomberg reporters said. Though spokespersons for Monsanto and Syngenta declined to elaborate – with Monsanto saying there were no discussions on the matter – the market continues to speculate.
"Informal talks have been held on numerous occasions and Syngenta explored its strategic options prior to the financial crisis, according to two people," the article continued, pointing to speculation surrounding other leading agricultural companies: Bayer, Dow and DuPont.
Though talks between Monsanto and Syngenta are reportedly dead, says the article, there is a chance the deal could be revived.
Continue reading on Bloomberg: http://bloom.bg/1lnzjBi